Maya can afford a monthly budget of £200 for treats and electricity. Assume that both are normal goods

TMA 01

The assignment

Important: These pages provide guidance on how to write your assignment. Please ensure you read all of this information right through until the checklist at the end.

Before you start work on this assignment, please ensure that you have read the Assessment Guidance specific to this module and are familiar with the advice in Social Sciences Assessment Information. These sources contain support and guidance that you may need in writing your TMA including, for example, advice on plagiarismreferencing and the marking system. Note that failure to comply with relevant guidance could result in the loss of marks or other penalties. 

There are two parts to this TMA. Answer Part A and Part B, noting the word limits. On the following pages you will find guidance on how to complete each of the different parts of this assignment. When you have completed the assessed parts of the TMA you will be invited to include reflections on the challenges of the TMA as this will help your tutor to provide appropriate feedback.

Part A (40% of the marks)

Maya can afford a monthly budget of £200 for treats and electricity. Assume that both are normal goods.

  1. Suppose that the prices are £20 per unit for electricity and £10 per treat. Draw a diagram showing Maya’s budget constraint and feasible consumption set. Explain your answer. Your diagram should measure number of treats along the horizontal axis and number of units of electricity along the vertical axis. (8 marks)
  2. Reproduce your diagram for Question 1 and add an indifference map comprising at least three indifference curves. Show the point of Maya’s utility maximization given her monthly budget and the prices of electricity and treats. Explain why this is a unique point. (10 marks)
  3. Now suppose that Maya’s income increases such that she can afford a monthly budget of £300 for electricity and treats. Reproduce your diagram for Question 2 and show how the increase in her budget changes her point of utility maximisation. Explain your answer. (10 marks)
  4. Finally, suppose that the price of electricity falls to £10 per unit whilst the price of treats is unchanged. Reproduce your diagram for Question 3 and show the effect of the price change on her point of utility maximisation. Make sure you illustrate and explain both the substitution effect and the income effect. (12 marks)

Word limit: 600 words

Part B (60% of the marks)

Write an essay on the following topic:

‘The role of women’s work in the household is often undervalued, but society tends to realise this only in times of crisis.’ Discuss this statement by using relevant household theories and referring to material from the article below. (60 marks)

Lewis (2020) ‘The Coronavirus Is a Disaster for Feminism’The Atlantic, March 19.

Word limit: 1500 words

All articles and data sets for use with TMAs can be accessed in the Assessment tab, see ‘Files for use’ sections for each TMA.

Student notes

Part A draws mainly on Chapter 2, Section 2. The questions assess your understanding of some of the main components of the neoclassical theory of consumption. The online tutorials on indifference curves will also provide useful guidance. You are asked to draw a number of diagrams, which should be fully labelled. Always include a brief explanation of your diagrams.

Question 1 requires a careful explanation of the feasible consumption set and budget constraint. Ensure you explain this in your own words and use the example of Maya.

For Question 2, make sure that you show the point of utility maximisation in the diagram and explain why it is a unique point.

For Question 3, you have to show the change in Maya’s budget, so think carefully about what is being measured on the axes of the diagram you draw: this will help you to work out how to illustrate an increase in Maya’s budget.

For Question 4, you have to show the change in the price of electricity on the diagram. You also have to indicate clearly on the diagram how we can conceptually isolate the substitution and income effects and explain this in words.

Part B

Part B, the essay question, asks you to draw on the different theories of household decision making outlined in Chapter 4 and examine how they help explain the evidence in the article provided. Materials in Chapter 3 are also relevant to the question.

Make sure you develop a clear and structured argument in your answer. You will gain more marks for covering a selected area of material in more depth than a superficial treatment of a wide range of material. So, for example you might wish to focus on two or three models of household decision making in your essay. You can always show a breadth of understanding by mentioning other models when discussing the evidence.

The key to writing a good essay is to be clear in your explanation of the terms you use, the theories you cover and how they relate to the evidence you select from the article. Remember to focus on using economic theory to help you to establish the points you wish to make. In addition, it is important that when you interpret evidence you always explain which theory supports your interpretation, which does not and for which reasons. This will allow you to compare the various theories on which you choose to focus. Section 5.3 of Chapter 4 offers an example of how evidence from a case study can be analysed in the light of different economic theories.

Traditionally, essays have a beginning that tells the reader about the structure of, and motivation for, the essay, a main middle section that explores a series of issues, and a short conclusion that brings together the key points that the essay has established. Also, make sure that you use referencing and know how to reference since it is a key academic skill and it is going to be important in your projects. The Open University uses the ‘Cite Them Right’ version of Harvard. You can find advice on the ‘Referencing and Plagiarism’ page of the Library website, which provides access to the Cite Them Right website, a practical guide to referencing commonly used by UK universities.

Learning outcomes

This assignment gives you the opportunity to demonstrate the following learning outcomes:

Knowledge and understanding

You should demonstrate a sound knowledge and understanding of:

  • the microeconomic theory of consumption at post-introductory level with applications
  • the main features, strengths and weaknesses of standard neoclassical microeconomic theory and alternative theoretical approaches
  • key ideas, theories and debates in microeconomic theory with applications to current issues in various areas, such as consumption and households.

Cognitive skills

You should demonstrate the ability to:

  • define and use key terms and concepts in economics
  • construct effective arguments in analysing economic questions
  • apply economic theories and models to analyse economic problems and events
  • evaluate economic statements and theories
  • use diagrams with verbal explanations of economic issues.

Key skills

Communication

You should demonstrate the ability to:

  • communicate effectively complex information and arguments in writing, using appropriate academic conventions
  • reference sources following appropriate academic conventions.

Use of number

You should demonstrate the ability to:

  • use diagrams to analyse economic issues.

Practical and/or professional skills

You should demonstrate the ability to:

  • evaluate competing explanations and theories in relation to evidence
  • analyse economic problems and issues.

Reflections on the assignment (not marked)

The purpose of this section is to enhance the dialogue you have with your tutor. You will receive better feedback and guidance if your tutor is well informed about your experience with the course materials. Here are some prompts that will help your dialogue about this TMA:

  • What were the main challenges you encountered while working on the questions in the two parts of the TMA?
  • Did you find any part particularly difficult?
  • To what extent did you overcome the challenges you identified?
  • Would any other support have been helpful?

Word limit: 100 words

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