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Hope you can review my requirements in detail. First you need to complete the questions in the document. Secondly, you will see that there are three photos, which are also titles. Completing these questions requires answering questions and drawing pictures. I need the complete answer process. I will also provide some image photos based on which you will find the image I need.
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Innovations in communications can cause shifts in the supply and/or demand for
transportation because they can be complementary, competitive, or cause changes
in consumer behaviour.
Explain how these communication innovations have affected transportation
markets, using an appropriate supply and/or demand model(s),
a) Videoconferencing e.g., Zoom
b) Online shopping e.g., Amazon
c) Synchronized traffic lights
d) Ride-sharing smartphone apps e.g., UBER
e) GPS-Google Maps navigation systems
Videoconferencing e.g., Zoom
P
S
D
D’
Q
Competitive: Airplane/Bus/Rail and Car Markets
Online shopping e.g., Amazon
P
P
S
S
D
D
D’
D’
Q
Complementary: Courier Delivery Market
Q
Competitive: Private Auto Market
Synchronized traffic lights
P
S’
S
D
D’
Q
Complementary: Urban Traffic Market
Ride-sharing smartphone apps e.g., UBER
P
S’
S
D
Q
Transformative: Taxi Market
GPS-Google Maps navigation systems
P
S’
S
D
Q
Complementary: Aviation Market
GPS-Google Maps navigation systems
P
S’
S
D
Q
Complementary: Trucking Market
Changing market conditions may allow trucking firms to make above normal
economic profits occasionally. This is not productivity efficient, but market forces
ensure that such inefficiency is not permanent. On the other hand, the railways can
make above normal economic profits on a regular basis, and they are neither
productively efficient, not allocatively efficient.
a) Use appropriate economic models to explain why economic profits in trucking
are temporary, while in the railways economic profits are typical.
b) Explain why the economic profits made by monopolies may not be so bad,
depending on their use, but the social welfare losses that they create are a real
problem.
Canada is an important exporter of wheat. This year the international markets have
been affected by the Russian blockade of the Ukraine wheat exports.
a) Use an appropriate model to explain how this blockade could change Canadian
wheat prices and exports.
b) The Russian invasion has also caused oil prices to rise which is a major input cost
for ocean shipping. Illustrate and explain whether this would impact Canadian
wheat prices and export. (You may use the same model, or to draw a second one.)
Canada
ROW
P
P
P
S
P
ES
S
P
Ed
D
D
Qd
Qs
Q
Q
P
Interregional Trade and
Transportation Demand Model
Qs
S
D
Q
Q
Qd
Q
Pea protein is the main ingredient used to produce “veggie burgers,” like Beyond
Beef. This week Beyond Beef announced layoffs. Analysts are suggesting that
consumers are switching to cheaper protein sources because inflation is cutting
into their food budgets.
a) Use an appropriate model to illustrate the impact that consumer behaviour is
having on the supply and demand for meat alternatives, and the peas that
farmers sell to make them.
b) Wage inflation and higher energy prices have made all supply chains more
expensive. Illustrate how this could be affecting the “veggie burger” and pea
prices. (You may use the same model, or to draw a second one.)
Price
DS
Retail
Pb
P’b
PD
PS
Farm
Pw
P’w
DD
Q’ Q
Veggie Burgs/Peas
Quantity
Price
DS
Retail
Pb
P’b
PD
PS
Farm
Pw
P’w
P’’w
DD
Q”Q’ Q
Veggie Burgs/Peas
Quantity
1. The elasticity of supply for Truckload (TL) trucking behaves differently during
economic expansions (boom periods) than it does during economic contractions
(recessionary periods).
a) Using an appropriate model explain how the TL trucking industry operates as if it
had a “kinked” supply curve, and why this occurs.
b) During a severe recession, some of the TL trucking companies will leave the
industry permanently. Using the model of a representative truckload trucking
company explain the conditions that could cause truckers to leave the industry.
c) Explain why the less-than-truckload (LTL) sector is less affected by these periods
of booms and recessions than the TL sector.
P
S shortrun
B
A
E
S longrun
C
GDP
F
D2
0
$
D
D1
Trucking
Rates
Q
Time
Rapid delivery of new trucks permits gradual expansion from A to C, while during recession, truckers take lower returns to ride
out the cycle, by moving down the shortrun supply curve from A to F. They do this because trucking is both their job, and in
many cases, their store of wealth. If the recession lasts too long, eventually some truckers are forced to leave and they end up at
point E. The industry adjusts to the size of the market because there is no alternative use for their assets.
Less-thanTruckload
Trucking
Productio
n
Possibility
Frontier
Truckload Trucking
As a recession progresses and freight rates fall,
the TL carriers are force to move down their
marginal cost curve. When they reach the point
that rates only cover the average variable costs,
they park the trucks. This is the shutdown point
where they are no longer making any contribution
to fixed costs.
The LTL carriers are less affect by the recession because they have
some market power, operating in a monopolistic competition
environment. There are fewer players, and less competition
because of the larger barrier to entry. Also, the LTL carriers have
economies of scope. They can operate some of their idle fleet of
trucks in the TL market. Finally, their customer base is much broader
with a myriad of small shippers, whereas the TL carriers may be
more dependent on one or two large shippers.
This figure illustrates five sizes of bulk
oil shipping tankers. Their capacities are
measured in dead-weight tons (DWT)
and their lengths are reported in metres.
a) Using an appropriate model(s), describe the economies size with respect to the
construction, operations and routing that determine these different sizes of ships.
b) Choose any two of these ships and explain with a model(s) the economies of
distance with respect to ship size.
c) How is it possible for small companies with only a few ships to compete with
big companies that have large fleets of ships. Use an appropriate model and
explain the economies of scale.
Using an appropriate model(s), describe the economies size with respect to the construction, operations and routing
that determine these different sizes of ships.
Construction follows the cube-square rule, in that
a ship twice as large does not require twice the
materials to build. In some cases, e.g., the bridge,
there may be no change at all.
Operations – A larger ship will have a similar crew
size and consume less fuel/t-km because water
resistance is not proportional to tonnage carried.
However, a larger ship will have a longer stay in
port loading and unloading.
Routing – Ships must observe minimum air and
water draft in order to use ports. Consequently,
their size prohibits them from certain ports, canals
and rivers.
Choose any two of these ships and explain with a model(s) the economies of distance with respect to ship size.
The cost of transport with respect to
distance can be divided into terminal
costs and linehaul costs. Smaller ships
have lower terminal costs because they
load and unload faster, while large ships
have lower linehaul costs because they
have lower fuel consumption per tonnekilometer. The heavy lines represent the
larger ships.
How is it possible for small companies with only a few ships to compete with big companies that have large fleets of
ships. Use an appropriate model and explain the economies of scale.
This answer applies to bulk shipping that
moves mainly full loads from port to port.
They have very low fixed costs other than
the ship, and no network economies.
Consequently they operate according to
constant economies of scale. The model
represents the impact of adding additional
ships to the fleet. Larger carrier make more
money in total, but not more per ship. Also,
it takes less effort to reach full utilization
with a smaller fleet than a large fleet, so they
can compete effectively with only a few
ships.
Innovations in communications can cause shifts in the supply and/or demand for
transportation because they can be complementary, competitive, or cause changes
in consumer behaviour.
Explain how these communication innovations have affected transportation
markets, using an appropriate supply and/or demand model(s),
a) Videoconferencing e.g., Zoom
b) Online shopping e.g., Amazon
c) Synchronized traffic lights
d) Ride-sharing smartphone apps e.g., UBER
e) GPS-Google Maps navigation systems
Videoconferencing e.g., Zoom
P
S
D
D’
Q
Competitive: Airplane/Bus/Rail and Car Markets
Online shopping e.g., Amazon
P
P
S
S
D
D
D’
D’
Q
Complementary: Courier Delivery Market
Q
Competitive: Private Auto Market
Synchronized traffic lights
P
S’
S
D
D’
Q
Complementary: Urban Traffic Market
Ride-sharing smartphone apps e.g., UBER
P
S’
S
D
Q
Transformative: Taxi Market
GPS-Google Maps navigation systems
P
S’
S
D
Q
Complementary: Aviation Market
GPS-Google Maps navigation systems
P
S’
S
D
Q
Complementary: Trucking Market
Changing market conditions may allow trucking firms to make above normal
economic profits occasionally. This is not productivity efficient, but market forces
ensure that such inefficiency is not permanent. On the other hand, the railways can
make above normal economic profits on a regular basis, and they are neither
productively efficient, not allocatively efficient.
a) Use appropriate economic models to explain why economic profits in trucking
are temporary, while in the railways economic profits are typical.
b) Explain why the economic profits made by monopolies may not be so bad,
depending on their use, but the social welfare losses that they create are a real
problem.
Canada is an important exporter of wheat. This year the international markets have
been affected by the Russian blockade of the Ukraine wheat exports.
a) Use an appropriate model to explain how this blockade could change Canadian
wheat prices and exports.
b) The Russian invasion has also caused oil prices to rise which is a major input cost
for ocean shipping. Illustrate and explain whether this would impact Canadian
wheat prices and export. (You may use the same model, or to draw a second one.)
Canada
ROW
P
P
P
S
P
ES
S
P
Ed
D
D
Qd
Qs
Q
Q
P
Interregional Trade and
Transportation Demand Model
Qs
S
D
Q
Q
Qd
Q
Pea protein is the main ingredient used to produce “veggie burgers,” like Beyond
Beef. This week Beyond Beef announced layoffs. Analysts are suggesting that
consumers are switching to cheaper protein sources because inflation is cutting
into their food budgets.
a) Use an appropriate model to illustrate the impact that consumer behaviour is
having on the supply and demand for meat alternatives, and the peas that
farmers sell to make them.
b) Wage inflation and higher energy prices have made all supply chains more
expensive. Illustrate how this could be affecting the “veggie burger” and pea
prices. (You may use the same model, or to draw a second one.)
Price
DS
Retail
Pb
P’b
PD
PS
Farm
Pw
P’w
DD
Q’ Q
Veggie Burgs/Peas
Quantity
Price
DS
Retail
Pb
P’b
PD
PS
Farm
Pw
P’w
P’’w
DD
Q”Q’ Q
Veggie Burgs/Peas
Quantity
1. The elasticity of supply for Truckload (TL) trucking behaves differently during
economic expansions (boom periods) than it does during economic contractions
(recessionary periods).
a) Using an appropriate model explain how the TL trucking industry operates as if it
had a “kinked” supply curve, and why this occurs.
b) During a severe recession, some of the TL trucking companies will leave the
industry permanently. Using the model of a representative truckload trucking
company explain the conditions that could cause truckers to leave the industry.
c) Explain why the less-than-truckload (LTL) sector is less affected by these periods
of booms and recessions than the TL sector.
P
S shortrun
B
A
E
S longrun
C
GDP
F
D2
0
$
D
D1
Trucking
Rates
Q
Time
Rapid delivery of new trucks permits gradual expansion from A to C, while during recession, truckers take lower returns to ride
out the cycle, by moving down the shortrun supply curve from A to F. They do this because trucking is both their job, and in
many cases, their store of wealth. If the recession lasts too long, eventually some truckers are forced to leave and they end up at
point E. The industry adjusts to the size of the market because there is no alternative use for their assets.
Less-thanTruckload
Trucking
Productio
n
Possibility
Frontier
Truckload Trucking
As a recession progresses and freight rates fall,
the TL carriers are force to move down their
marginal cost curve. When they reach the point
that rates only cover the average variable costs,
they park the trucks. This is the shutdown point
where they are no longer making any contribution
to fixed costs.
The LTL carriers are less affect by the recession because they have
some market power, operating in a monopolistic competition
environment. There are fewer players, and less competition
because of the larger barrier to entry. Also, the LTL carriers have
economies of scope. They can operate some of their idle fleet of
trucks in the TL market. Finally, their customer base is much broader
with a myriad of small shippers, whereas the TL carriers may be
more dependent on one or two large shippers.
This figure illustrates five sizes of bulk
oil shipping tankers. Their capacities are
measured in dead-weight tons (DWT)
and their lengths are reported in metres.
a) Using an appropriate model(s), describe the economies size with respect to the
construction, operations and routing that determine these different sizes of ships.
b) Choose any two of these ships and explain with a model(s) the economies of
distance with respect to ship size.
c) How is it possible for small companies with only a few ships to compete with
big companies that have large fleets of ships. Use an appropriate model and
explain the economies of scale.
Using an appropriate model(s), describe the economies size with respect to the construction, operations and routing
that determine these different sizes of ships.
Construction follows the cube-square rule, in that
a ship twice as large does not require twice the
materials to build. In some cases, e.g., the bridge,
there may be no change at all.
Operations – A larger ship will have a similar crew
size and consume less fuel/t-km because water
resistance is not proportional to tonnage carried.
However, a larger ship will have a longer stay in
port loading and unloading.
Routing – Ships must observe minimum air and
water draft in order to use ports. Consequently,
their size prohibits them from certain ports, canals
and rivers.
Choose any two of these ships and explain with a model(s) the economies of distance with respect to ship size.
The cost of transport with respect to
distance can be divided into terminal
costs and linehaul costs. Smaller ships
have lower terminal costs because they
load and unload faster, while large ships
have lower linehaul costs because they
have lower fuel consumption per tonnekilometer. The heavy lines represent the
larger ships.
How is it possible for small companies with only a few ships to compete with big companies that have large fleets of
ships. Use an appropriate model and explain the economies of scale.
This answer applies to bulk shipping that
moves mainly full loads from port to port.
They have very low fixed costs other than
the ship, and no network economies.
Consequently they operate according to
constant economies of scale. The model
represents the impact of adding additional
ships to the fleet. Larger carrier make more
money in total, but not more per ship. Also,
it takes less effort to reach full utilization
with a smaller fleet than a large fleet, so they
can compete effectively with only a few
ships.
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