GECO5113 Business Economics Individual Assignment Module 1, Semester July 2025 | UniRazak

Individual Assignment Module 1, Semester July 2025

Plagiarism / Originality of the Contribution

(Excerpt from Item 17.0, Unirazak Academic Regulations for Postgraduate Programmes)

1) Plagiarism refers to the unauthorised use or close imitation of the language and thoughts of another author without acknowledgement, and to represent it as one’s original work in fulfilling an academic requirement, such as in assignments, dissertations, and thesis.

2) This also includes any usage of AI tools such as ChatGPT or any similar tools.

3) A Student who committed plagiarism will be penalised based upon a decision made by the Faculty Academic Committee.

4) Details of the prohibition against plagiarism can be found in the Unirazak Student Regulations Book.

Examination Misconduct

(Excerpt from Item 21.4.2, Unirazak Academic Regulations for Postgraduate Programmes)

1) A student who has committed misconduct or academic wrongdoing can be charged with Academic misconduct according to the University and College University Act, 1971, Regulations of the University (Students' Disciplinary).

a) Giving, receiving, or possessing notes or some other materials in various forms relevant to the course during the examination inside and outside of the exam hall

2) If the student is found guilty of misconduct by the Faculty Academic Committee and pending the approval of the Senate, the student can be penalised as follows:

a) Receive a ZERO (0) mark for the examination

OR

b) Receive a ZERO (0) mark for the course

OR

c) Receive a ZERO (0) mark for all registered courses for the semester

OR

d) Suspended from study for a duration specified by the Senate.

3) Students who are caught breaching the Examination Rules and Regulations will be charged with Academic Dishonesty. If found guilty of the offence, the maximum penalty is expulsion from the University.

Real Case Study

Q1.  Queues At The Patrol Station

In 2020, the Organisation of Petroleum Exporting Countries (OPEC) raised the price of crude oil in world oil markets because crude oil is the major input used to make petrol, and the higher oil prices reduced the supply of petrol. In Malaysia, long queues at petrol stations become commonplace, and motorists often have to wait for hours to buy only a few gallons of petrol. What was responsible for the long queues at the petrol stations?. Most people blame OPEC. Surely, if OPEC had not raised the price of crude oil, the shortage of petrol would not have occurred. Yet economists blame Malaysian government regulations that limited the price oil companies could charge for petrol. Eventually, the law regulating the price of petrol was repealed. Lawmakers came to understand that they were partly responsible for the many hours Malaysian lost waiting in line to buy petrol. Today, when the price of crude oil changes, the price of petrol can adjust to bring supply and demand into market equilibrium.

Quick Quiz: With an appropriate diagram, define price ceiling and price floor and give an example of each. Which leads to a market shortage? Why lead to a surplus? Justify your answer.

(10 marks)

Q2 Near-Empty Restaurants

Have you ever walked into a restaurant for lunch and found it almost empty? Why, you might have asked, does the restaurant even bother to stay open?. It might seem that the revenue from the few customers could not possibly cover the cost of running the restaurant. In making the decision on what to open for lunch, a restaurant owner must keep in mind the distinction between fixed and variable costs. Many of a restaurant’s costs- the rent, kitchen equipment, tables, plates, silverware, and so on- are fixed. Shutting down during lunch would not reduce these costs. In other words, these costs are sunk in the short run. When the owner is deciding what to serve for lunch, only the variable costs – the price of the additional food and the wages of the extra staff- are relevant. The owner shuts down the restaurant at lunchtime only if the revenue from the few lunchtime customers fails to cover the restaurant’s variable costs.

Quick Quiz:

a) How does the price faced by a profit-maximising competitive firm compare to its marginal costs? Explain.

b) With an appropriate diagram, when does a profit-maximising competitive firm decide to shut down? And when does a profit-maximising competitive firm decide to exit a market in the short run?              

(Total: 10 marks)