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BUSI3491
Business Economics
Undergraduate Programmes 2024/25
SUMMATIVE ASSIGNMENT
Overall word limit: 3,000 words (excluding charts, graphs/diagrams, figures,
and references; see below for more details)
There are 6 questions, each consisting of several parts. You must answer ALL
questions. The weight of each question in the total assignment mark is
indicated below. All parts within each question carry equal weight.
Please note: Any graphs / diagrams submitted as part of the assessment must
be drawn using MS Office or an equivalent software. They must NOT be drawn
by hand.
1. [15%] Use verbal and graphical analysis in answering a) and b).
Suppose the government aims to inject demand into the economy and REDUCES
the specific tax levied on a particular good.
a) Assuming equal elasticities of demand and supply, detail the market’s move from
the equilibrium with the initial (higher) tax to the new equilibrium with the new
reduced tax.
b) Explain how consumer welfare, producer welfare and government welfare change
due to the reduction in the tax levy.
2. [20%] Use verbal and graphical analysis in answering a) – c).
Suppose there are no government subsidies to higher education.
a) Explain the private market equilibrium that will result according to the Law of
Demand and Supply without any subsidies.
b) How and why does the private market equilibrium differ from the efficient market
outcome
c) Now suppose the government decides to subsidise higher education. Explain what
effect the subsidy will have on the market outcome.
d) Might there be any controversy around the use of the subsidy, if it was funded
through an increase in income tax (verbal answer only)
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BUSI3491
Business Economics
Undergraduate Programmes 2024/25
3) [15%] Use verbal and graphical analysis in answering a) and b).
Suppose a pharmaceutical company has produced and patented a drug against
dementia and offers the drug to all customers at the same price.
a) What market structure will securing the patent most likely impose on the market
for the drug In what way is this market structure beneficial to the company
b) Explain why this market structure is in many cases considered undesirable by
governments and many market participants and observers
c) With regard to your answer to part b), explain (verbally only) why, in this particular
case, this market structure may be acceptable for a certain period of time. [You could
link your answer to that to question 2 b).]
4. [10%]
Explain how moral hazard can result from asymmetric information. In each of the
following two cases, identify the principal and the agent, the asymmetric information
held, and the resulting potential moral hazard. How is the action described in each
case intended to reduce the problem of moral hazard
a) A landlord requires their tenants to pay a security deposit at the start of the
tenancy.
b) A car insurance company offers discounts to customers who install an anti-theft
device in their car.
5. [25%]
Find ONE news article of your choice, that relates to the workings of a theory /
concept from the module. Using this theory / concept, explain in detail the economic
problem related in the article, as if presenting to colleagues who have no economics
background knowledge. Use verbal as well as graphical analysis. Link to relevant
other theories / concepts from the module as applicable. Begin your answer by
briefly outlining the economic problem.
Please provide the online link to the article in your reference list or insert a copy of
the article into your assignment as an appendix. Please note, you must NOT use any
of the articles discussed in the module lectures or seminars.
6. [15%]
Find a sustainability report of ONE business of your choice. With reference to
sustainability-related issues discussed in the module and with reference to some
literature, analyse in what ways the business is seeking to increase its levels of
sustainability. Explain possible benefits and challenges of implementing these
sustainability practices for the business.
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BUSI3491
Business Economics
Undergraduate Programmes 2024/25
Please provide the online link to the sustainability report in your reference list. Please
note, you must NOT use any business whose sustainability report is discussed in the
module lectures or seminars.
SUBMISSION INSTRUCTIONS
Your completed assignment must be uploaded to Blackboard
no later than 12:00 midday on 2
nd
May 2025.
The assignment should be submitting using one of the following file
types: .doc, docx or .pdf
A penalty will be applied for work uploaded after 12:00 midday as detailed in
the Student Information Hub. You must leave sufficient time to fully complete
the upload process before the deadline and check that you have received a
receipt. At peak periods, it can take up to 30 minutes for a receipt to be
generated.
Assignments should be typed, using 1.5 spacing and an easy-to-read 12-point font.
Assignments and dissertations/business projects must not exceed the word count
indicated in the module handbook/assessment brief.
The word count should:
Include all the text, including title, preface, introduction, in-text citations,
quotations, footnotes and any other items not specifically excluded below.
Exclude diagrams, tables (including tables/lists of contents and figures),
equations, executive summary/abstract, acknowledgements, declaration,
bibliography/list of references and appendices. However, it is not appropriate to
use diagrams or tables merely as a way of circumventing the word limit. If a
student uses a table or figure as a means of presenting his/her own words, then
this is included in the word count.
Examiners will stop reading once the word limit has been reached, and work beyond
this point will not be assessed. Checks of word counts will be carried out on
submitted work, including any assignments or dissertations/business projects that
appear to be clearly over-length. Checks may take place manually and/or with the
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BUSI3491
Business Economics
Undergraduate Programmes 2024/25
aid of the word count provided via an electronic submission. Where a student has
intentionally misrepresented their word count, the School may treat this as an
offence under Section IV of the General Regulations of the University. Extreme
cases may be viewed as dishonest practice under Section IV, 5 (a) (x) of the General
Regulations.
Very occasionally it may be appropriate to present, in an appendix, material which
does not properly belong in the main body of the assessment but which some
students wish to provide for the sake of completeness. Any appendices will not have
a role in the assessment – examiners are under no obligation to read appendices and
they do not form part of the word count. Material that students wish to be assessed
should always be included in the main body of the text.
Guidance on referencing can be found on Durham University website and in the
Student Information Hub.
MARKING GUIDELINES
Performance in the summative assessment for this module is judged against the
following criteria:
Relevance to question(s)
Organisation, structure and presentation
Depth of understanding
Analysis and discussion
Use of sources and referencing
Overall conclusions
PLAGIARISM AND COLLUSION
Students suspected of plagiarism, either of published work or the work of other
students, or of collusion will be dealt with according to School and University
guidelines.
END OF ASSESSMENT
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