2.++Economic+Models

= Ms Stevenson will not be providing any more comments on this page = =​ 2. Economic models =

**Your task** 1. Press edit above 2. Move your cursor below your name (scroll down) - only work in the area under your name 3. Apply your economic models 4. Explain how they relate to your economic problem 5. **Using the table button** on the menu above select a table with 3 columns and 3 rows to record your evidence and sources (**use link - external link button above**). //Just start typing in the table - it will format itself when you press save!//


 * Miss Stevenson's exemplar **

**Economic Models** || **How it relates to my economic problem that** ** "The increasing popularity of E-books will see the demise of the printed book industry in Australia" ** || 1. || Price mechanism || Demand for printed books is shifting left which means that both the price and quantity supplied will decrease. || 2. || Circular Flow || * The CE from HH to production for printed books will decrease
 * This will reduce demand in Production Sector
 * etc
 * etc
 * etc ||


 * 1. Alek A**


 * 2. Jordan B**

**Economic Models** || **How it relates to my problem** which is ................... || 1. || Price mechanism || The demand for mining will decrease while the supply stay the same.This will result in a surplus in supply and cause unemployment cause the market equilibrium to contract with a decrease in quantity and cost. Jordan I don't think this is right ... I think the demand for minerals will stay the same or decrease due to additional cost that needs to be passed on ....supply will also decrease as less miners will supply minerals from Australia due to increased cost? Send me an email to discuss if this doesn't make sense.... || 2. || Circular Flow || Due to the determinant of demand ' expectation' being impacted in investment there will be a decrease in investment. [what sectors are your referring to here?] The taxes will also increase (leakages). And potentially mining buisnesses may close which will effect exports. In conclusion injections(exports, investment) will be impacted while Leakages(taxation) will increase cause the CFM to contract, ||


 * 3. Ned B**

as before, my laptop collapsed ... so I'll do this again very quickly

price mechanism, circular flow model Ned - need more detail here

Economic models || How it relate my problem which is .... || 1. || Circular flow model || - pilot shortage has worsened the demand for pilots in the foreign sector Miss Stevenson: I don't think this is correct- I think you need to consider other sectors in the CFM - experienced captains are leaving the regional carriers due to lowly pay and poor working conditions which will lead to no income taxes from the govt sector ﻿﻿﻿﻿ If they are still working they will still be paying tax? ||
 * 4. Albert C**

Supply and Demand of Labour || Due to the pay disputes, nurses have been forced to leave their jobs, causing the supply curve to shift left, lowering the supply of labour and increaseing the demand || Peter: Good - but check your spelling !
 * 5. Peter C**
 * Economic models** ||
 * How it relates to my problem** ||
 * 1.** ||
 * 1.** ||
 * 1.** ||
 * 2.** ||
 * Circular Flow Model** || * **The pay disaster has resulted in less income for nurses (the household sector)**
 * **this has in turn reduced the amount of consumer expenditure from the household sector**
 * **since many nurses have been forced to quit their jobs the government is not getting any income taxes**
 * **the government is being forced to spend money on the out of work nurses (the doll, etc.)**
 * **since they have less money, nurses are less likely to save in the bank** ||
 * **since they have less money, nurses are less likely to save in the bank** ||

PPC || Due to the lack of adequate infrastructure to meet export demands, coal companies are currently performing under their production possibility. very good || 2. || Circular Flow Model || * Production sector will be producing less therefore will have less profit
 * 6. Ian C**
 * Economic models** ||
 * How it relates to my problem ﻿Please put your problem in here ** ||
 * 1.** ||
 * 1.** ||
 * 1.** ||
 * If the problem continues mining companies may begin to lose money and have to close mines, leading to major job loss
 * If necessary infrastructure is provided Increased exports will inject more money from the foreign sector into the economy
 * If more profit is made by the production sector it will have more money to employ more people, therefore there will be increased income in the household sector.
 * More jobs for household sector will also be provided when building infrastructure to support the coal exports
 * More jobs will lead to more consumer expenditure into other businesses in the production sector
 * The financial sector will grow because more of the household and production sector will be saving their money ||

7. **Fletcher F**

8. **Callum G** Economic Models || How it relates to my problem which is ...... || CFM || As opposition to uranium mining results in fewer exports and thus fewer injections into the production sector less income can be provided to the household sector and hence is limiting possible employment opportunities to Australia’s labour. In collaboration with this, with the support of government and investment expenditure prospects of a more prosperous Australian uranium market appears possible and viable. || PPC || Australia’s production possibility curve as a result of opposition to uranium mining results in underutilisation of resources and underemployment. Hence, it is clear that the market is performing below the production possibility curve. ||

Good points!

9. **Elliott G**

10. **James H** **Economic Models** ||< **How it relates to my problem that t he small Australian motor vehicle market is forcing the automotive industry to locate off shore ** || 1. ||< Price mechanism ||< Demand for Australian-produced motor vehicles is shifting left which means that price and quantity supplied by Australian markets will decrease. Demand for cheaper foreign built cars is shifting right which means that the price and quantity of cars supplied by overseas markets will increase. very good || 2. || Circular Flow || * The G+S from production to HH for cars will decrease [how does this link to workers in Australian car companies?]
 * This will increase demand in Foreign Sector
 * Government will not get taxes from production companies or the sales they make to HH
 * Fewer exports of Australian cars to the rest of the world will occur
 * Leakages from flow > injections into flow resulting in market contraction ||

11. **Noah K** Supply of water is decreasing while demand is remaining the same. This means the price wil increase and the quantity supplied will decrease ||
 * Economic models** ||
 * How it relates to my problem that Austalia's water shortage is having serious effects on the economy.** ||
 * 1.** ||
 * Price mechanism model (Supply and Demand)** ||
 * 1.** ||
 * Price mechanism model (Supply and Demand)** ||
 * 2.** ||
 * Circular Flow Model** || * **Agricultrual segment of the production sector will not produe as much due to higer costs**
 * **As the production sector is producing less, there will be many emloyees that are laid off**
 * **There will be less money flowing into the household sector through Y**
 * **The government will receive less taxes**
 * **The financial sector will receive a lower flow of money through savings** ||
 * **The financial sector will receive a lower flow of money through savings** ||

Noah - you might also want to think about replacing Australias production with imports

12. **Sam L** Economic models || How it relates to my problem that, " **Australia's manufacturing industry lags behind other developed nation's such as japan and the United states of America, restricting growth/ development of the nation while reducing diversification.** " || 1. || Price mechanism model || CFM? ||  ||
 * Due to the increased amount of manufactured goods being imported into Australia, prices are being forced down due to a surplus being created as demand for such goods stay the same in Australia. **
 * As such, manufactures based in Australia cannot compete due to certain laws and taxes imposed by the government specifically affecting and influencing the price mechanism for Australian products and therefore keeping the prices high for Australian goods. ﻿what laws are these? **
 * As such, the consumer will generally buy the cheaper imported good, forcing ** [which] ** companies to either shut down and/or move to an overseas country without these imposed laws and taxes. ** is there any other alternative? ||

Sam - can you please not use bold - it is hard to read ...

13. **Caleb L** Supply and Demand of Labour || Demand for jobs will decrease as the wage is not sufficient for job seekers thus a surplus of jobs will arise. || good
 * Economic models** ||
 * How it relates to my problem that the minimum wage in Australia is too low** ||
 * 1.** ||
 * How it relates to my problem that the minimum wage in Australia is too low** ||
 * 1.** ||
 * 1.** ||
 * 2.** ||
 * Circular Flow Model** || * The low wage experienced by minimum wage workers means the income flow from the production sector to the household sector is decreased
 * This results in less consumer expenditure back into the production sector
 * Less income coming into the household sector will also result in less savings from the household sector flowing into the financial sector
 * Furthermore, less taxes from the household sector will flow into the Government sector, thus resulting in less government expenditure spent back into the production sector. ||
 * Furthermore, less taxes from the household sector will flow into the Government sector, thus resulting in less government expenditure spent back into the production sector. ||

14. **Angus L** Demand for GPs in Australia is shifting right which means that the price is rising but quantity supplied is also decreasing, Check this! || Rethink your CFM ... I am not sure this is right?
 * Economic models** ||
 * How it relates to my problem that there is a serious skills shortage in the medical industry** ||
 * 1.** ||
 * Price mechanism model (Supply and Demand)** ||
 * 1.** ||
 * Price mechanism model (Supply and Demand)** ||
 * 2.** ||
 * Circular Flow Model** || * The CE from HH to Production will increase due to less demand ?
 * There are a greater number of unemployed so less Taxation
 * There is less government spending to Hospitals
 * Less injections into Businesses so there is less employment
 * less savings to the financial sector ||
 * less savings to the financial sector ||

15. **Hamish L**

1. || Price mechanism || Demand for resources from china/india is increasing causing a expansion in supply and an increase in price. || 2. || D+S of Labour || Demand for labour is increasing with the increase of our population; unfortunately the supply is not increasing as fast. This means jobs will pay higher. Don't think this is right? || 3. || Circular Flow || * An increase in the number of exports to the foreign sector 4. || PPC || The resources sector is performing on the curve, however, the foreign sector wants it to achieve an unattainable level with the current labour numbers. || Hamish - you need to rethink the above done! i hope......
 * Economic Models** ||
 * How it relates to my economic problem that** **"****There is a serious skills shortage in the mining labour market.****"** ||
 * How it relates to my economic problem that** **"****There is a serious skills shortage in the mining labour market.****"** ||
 * Requires the production sector to increase its output
 * so resourse (LLCE) need to increase
 * However, this is not the case, therefore, output is down what they hope it to be and so is exports. ||

16. **Neil M** **Economic Models** ||< **How it relates to my problem that t he small Australian motor vehicle market is forcing the automotive industry to locate off shore ** || 1. || Price mechanism (Supply and Demand) || As the price on foreign imports drops, due to decrease in tariffs, the demand for foreign cars will increase. This is not the first thing you should be discussing with your problem - why don't you look at the market for Australian motor vehicles || 2. || Circular Flow Model || * Production Sector receives less CE from household sector if foreign cars are chosen over local car manufacturers. Foreign Sector Government Sector 1. ||
 * Leakages in the form of imports of foreign cars.
 * Smaller injections due to lack of exports of local cars.
 * Leakages in the forms of Tariffs on imported cars.
 * Government stimulus for Australian car industry, injection. ||

You need to keep going in the PRoduction sector - less demand means what .... .?

17. **Jon O**

18. **Josiah S** How it relates to my economic problem that; **'The price of fossil fuels is excessive.'** || 1. || Price mechanism || Because the [what ... demand, supply... what? ] fossil fuels are very inelastic, then in theory, an increase in price should cause a small drop in demand. However, this is not the case, as through the trend of the last 20 years is for the price of oil to go up, but a significant increase in demand for oil has also arisen. This is because of the emergence of new demand, i.e. China, Africa, and other developing nations. MEDCs demand for oil has increased very slightly if not remained the same. With the increase of demand, supply must 'catch up'. However, there is a limited amount of these fossil fuels, and therefore once 'peak oil' is reached, the price of fossil fuels will truly soar and therefore become uneconomically viable for profit. (Eventually a high enough price will drop demand significantly, so the oil companies will lose in two ways; firstly that oil will become increasingly expensive and difficult to be drawn up from the earth and secondly that people won't be able to afford such an expensive neccesity. [|Oil Elasticity] || 2. || Circular Flow || ???? ||
 * Economic Models** ||
 * Economic Models** ||

19. **Keiran S** How it relates to my economic problem that; **"The increase in population in Australia is having negative effects on the economy"** || 1. || Price mechanism ||  || 2. || D+S || Immigration affects the demand side of Australia's economy through: It also affects the supply side of the economy through: Like all Australians, migrants pay taxes to, and receive benefits and goods and services from, government. Research shows that, overall, migrants contribute more in taxes than they consume in benefits and government goods and services. As a result migrants generate surpluses for government This point contradicts your economic problem..................maybe you need to change your problem to we don't have enough migrants? . Australia's economic growth is significantly enhanced when migrant's direct impact on the economy through their contribution of migrants to supply and demand and their indirect contribution to government surpluses (or smaller deficits), work their way through the economy. same point as above ... contradicts your economic problem || Circular Flow ||  ||
 * Economic Models** ||
 * Economic Models** ||
 * migrants' own spending (food, housing and leisure activities)
 * business expansion (investment to produce extra goods and services)
 * expansion of government services (health, education and welfare).
 * labour, skills and capital introduced into Australia
 * new businesses developed by migrants
 * migrant contributions to technology
 * adding productive diversity through knowledge of international business markets.

20 **Craig S**

1. || Price elasticity of demand || Electricity is a necessity and there is no substitute. Therefore a change in price will bring about a smaller proportional change in quantity. Thus it can be said that electricity is relatively inelastic. So as prices increase the quantity demand remains around the same level. This is what is happening under state-ownership and prices are expected to continue rising. || 2. || Circular Flow || (With continual state-ownership) Good ...
 * Economic Models ** ||
 * How it relates to my economic problem that “State-ownership of the electricity industry in Queensland has adversely impacted electricity purchases for households and businesses” ** ||
 * How it relates to my economic problem that “State-ownership of the electricity industry in Queensland has adversely impacted electricity purchases for households and businesses” ** ||
 * At the moment there is too much labour from HH to the production sector. This adds to the production sector’s inefficiency (along with too much capacity, low productivity, restrictive working practices due to Unions…). [So maybe discuss production output being too low]
 * This will lead to higher prices. As it stands prices will continue to rise. Therefore CE from HH to the production sector should decrease.
 * This will reduce demand in the production sector. However electricity is a necessity and thus it is fairly inelastic. The CE decrease will therefore be slight as will be the effect on demand.
 * Taxes will rise to fund the uneconomical production sector (via GE).
 * GE will persistently rise (eg. multi-billion dollar spending scheme for Energex/Ergon).
 * This is effectively a continual cycle. ||

21. **Cameron W**

**Economic Models** || **How it relates to my economic problem that** ** "The privatization of QR will adversely affect ticket prices" ** || 1. || Price mechanism || The Ticket prices for passengers will shift right resulting in an increase in prices. Demand or Supply ? This doesn't make sense || 2. || Circular Flow || * The CE from HH to [Where?] amount of passengers will decrease.
 * This will reduce demand in Production Sector
 * **Therfore there will be less income in the HH as less jobs will be used due to less demand for rail**
 * **Note: Public transport is a necessity, so there is a limit to how low the demand can get.** ||