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1st year degree economics, please help

Hello,

I was meant to be doing a presentation in uni and havnt been well so they set me an essay instead. I dont have a clue where to even start as i havnt been attending due to being sick!

Here it is:

"Using diagrams, explain the response of a perfect market to an increase in consumer incomes, identifying the change in price and in the quantities demanded, (50%)"

and

"How relevant is this model to real markets (50%)"

It only has to be 1000 words, I dont know where to start, does anyone know what model its even referring to? That would be a great help!

Reply 1

danny111

I would start with what effect an increase in income has on demand. Perfect market I assume means perfect competition. So what effect has income on demand. What diagram can you draw to represent the market and see the effect. Then what does the change in the market mean for the firms in the market, how will they react. What will change for them in the short run? You know you are in perfect competition so what happens to the market because of this?

Reply 2

adamCCC

thanks for your input but you have just asked me more questions i dont know the answer to :/ eek

Reply 3

danny111

How about opening a textbook or reading lecture notes?

Reply 4

Ecosse_14

Original post by adamCCC

thanks for your input but you have just asked me more questions i dont know the answer to :/ eek

Nobody is going to give you the answer. Instead, they are going to guide you in the right direction which the user has done. If you have lecture slides or a textbook, the information you'll be looking for will be in them.

Reply 5

adamCCC

Original post by danny111

How about opening a textbook or reading lecture notes?

firstly, i am not looking for someone to write me as essay, just looking for some pointers, secondly there is no need to be cheeky. the textbook and notes just defines things such a perfect competition and what attributes makes it such as no barriers to entry, price takers etc etc etc.

however:

Original post by danny111

I would start with what effect an increase in income has on demand. Perfect market I assume means perfect competition. So what effect has income on demand. ?

I dont mean to sound ungrateful, but that is just re wording the question.. the question i asked was "how does income affect demand" and you have answered by saying "start with saying what effect income has on demand".. thats no help at all and merely stating the obvious.

the question isnt simply "how does income affect demand".. i know how to answer that, but what im unsure of is how to answer it in relation to a perfect market..

Original post by danny111

What diagram can you draw to represent the market and see the effect.

Once again, I know i have to do a diagram - if i knew what diagram to do, I wouldnt be asking. If you knew what diagram it was, for instance lets say a demand curve, why didnt you just say demand curve? that isnt "doing it for me" but it is pointing me in the right direction.

i know this reply is clearly not going to go down well, and as much as i appreciate the time uve taken to even respond, there was no need to jump the gun and think im one of the regular people who is just looking for someone to do their work for them.

Reply 6

Krov

Original post by adamCCC

Hello,
"Using diagrams, explain the response of a perfect market to an increase in consumer incomes, identifying the change in price and in the quantities demanded, (50%)"

"How relevant is this model to real markets (50%)"

It only has to be 1000 words, I dont know where to start, does anyone know what model its even referring to? That would be a great help!

Income goes up = S(avings) + C(onsumption) increases = Demand increases = Price increases = Supply increases.

How relevant to real markets ?

Not much.

Reply 7

danny111

I am 100% certain that there is enough information in your textbook and notes that you could answer my questions.

You write in OP you don't know where to start. And yet when I tell you I would start with looking at how demand is affected you say well that is silly that is just rephrasing the question. That was not up to debate. You have to start with how an increase in income affects demand for this question. Because that is the logical sequence of events. What effect has an increase in income. It affects consumers choice. How is consumer choice incorporated in this - with a demand curve.

And, lol, I told you you should look at how demand is affected and then asked you to draw a diagram. I think only people with an IQ of 50 would not realise this suggests a supply and demand diagram...