T‌‍‍‍‌‍‍‌‌‍‍‍‌‍‍‍‍‌‍‍his is intermediate microeconomics writing assignment. Basi

T‌‍‍‍‌‍‍‌‌‍‍‍‌‍‍‍‍‌‍‍his is intermediate microeconomics writing assignment. Basically, this essay needs to analyze the policy impact on consumers/producers/government/ society as a whole. The essay requires knowledge about tax/subsidy, producer revenue maximization, tax revenue under government intervention, consumer welfare, etc. sample and essay requirements are attached! Prof. does not require outside reference. He wants us to apply microeconomics in analysis. Please contribute your professional knowledge, thanks! Your Role In this assignment, you will act as an applicant for the Chief Economist role at Tesla, using your knowledge from ECO200. Let’s see if you can get the position! In your writing assignment, you should analyze the scenario using the tools we have discussed in ECO200. You may assume that your audience has also had ECO200. This means that you should model and describe the situation under consideration using tools we have discussed, and analyze the predictions of that model as it relates to the policy objectives. You should be clear about what you are considering when making your policy recommendations, and how those factors impact your decision. If you make any additional assumptions (beyond those mentioned above), you should clearly state them and, if relevant, address what would happen if those assumptions do not hold. In this section, you may use technical terms, such as “deadweight loss”, but you should not include any graphs. Your Tasks 1) Analyze the likely effects of the Zero Emissions Vehicles (ZEV) subsidy and the tax on carbon using tools from ECO200, and 2) Explain the potential impacts of the ZEV subsidy and the carbon tax for Tesla. 3) Briefly talk about government’s perspective on the policies and social welfare. IMPORTANT: since we have not yet covered producersâ behavior, assume that Tesla’s objective is to maximize total revenue, which is the number of vehicles sold times the price. Premise “The Canadian government recently announced a Zero Emissions Vehicle (ZEV) mandate. It requires that by 2030, half of all new light-duty vehicles sold fall into the ZEV category, which includes electric, hybrid, or hydrogen powered vehicles. By 2035 this requirement will apply to all new light-duty vehicles. Without providing any details, the government also announced it will make $ available for rebates (or subsidies, herein used interchangeably) on ZEV purchases.” Scenario This announcement has garnered the attention of many ZEV proponents—including Elon Musk. In light of this, Elon has become obsessed with the Canadian ZEV market and, as such, has set up a new head office in Toronto. The Board of Directors has told him that he needs to hire a Chief Economist to assess the market landscape here in Canada in the wake of the government’s new ZEV mandate. For reasons he’s chosen not to disclose, he’s looking to hire this new executive exclusively from U of T’s ECO200 class of 2021/22. As part of the hiring process, he has put together an assignment for this class. He has chosen to provide an outline where he has specified the key topics he wants candidates to address. Although these topics are fairly wide open, Elon wants his Chief Economist to ECO200 Page 3 2 • • • • • • The market demand for a ZEV with and without the ZEV subsidy The impact of the cut-off price (under $45,000) on vehicles eligible for the subsidy How will the subsidy affect market supply in the short and long run? The effect of the mandate—which is essentially a ban on light-duty vehicles that are not zero-emission after 2035—on consumers Consequences for Tesla’s revenue … Carbon Tax and Internal Combustion Engine (ICE) Vehicles (30 points) ZEVs are cheaper to operate than Internal Combustion Engine (ICE) vehicles sim- ply because fuel is non-renewable and is more expensive per kilometer than electricity, no matter how efficient the combustion engine is. I have heard fuel has become increasingly more expensive in Canada. As far as I know, this issue is h‌‍‍‍‌‍‍‌‌‍‍‍‌‍‍‍‍‌‍‍eavily influenced by Canadian taxes on fossil fuels. In 2018, the Canadian government introduced new legislation imposing a Carbon Tax on fossil fuels like gasoline and natural gas. Then, in 2020, the government altered the tax scheme lifting the final tax level higher than was initially out- lined; the plan is structured such that the final level of taxation is reached over gradual ECO200 apply economic concepts across a range of possible issues as they relate to Tesla. That being said, part of this assignment is to gauge how you—as an economist—think these areas relate to Tesla’s business. That means you do not have to address all of the guiding points provided and are encouraged to offer insights that stand out from the crowd. In doing so, keep in mind that Elon is also a stickler for concision, so make sure everything you include in your assignment adds to your addressing of the section’s topic. Elon has set a hard limit for the assignment of 500 words. Remember, your chance of getting this position depends significantly on the output of your work. Here is the outline he has provided: 1 The Subsidy and the ZEV Market (30 points) I am trying to get a better understanding of how this new mandate will impact Canada’s ZEV market. I know that for some years, the federal and most provincial governments have offered incentives for consumers who buy ZEVs. The Federal government currently provides a subsidy of up to $5,000 on the purchase of new ZEV; this rebate only applies to cars under $45,000, for the most part. There are a limited number of rebates available in that the incentive program has limited funds. Before the mandate’s new funding, there was only enough for 120,000 vehicles, assuming $5,000 for each new car sold. Tesla’s business is directly related to this topic. I need my Chief Economist to explain the elements of ZEV market and the possible consequences of the new mandate for Tesla’s revenue. In doing so, keep in mind the following (but do not limit yourself to this list, it is by no means comprehensive): Page 4 • • • • • 3 Carbon taxes, fuel market, and vehicle market Tax implications for producers and consumers Implications of the carbon tax on vehicle ownership Consequences for Tesla’s revenue … Policy Evaluation (30 points) Let’s fuel tax and ZEV subsidy policies. You can use the following points to get started on evaluating these policies. 4 • • • • Do these policies help or hurt ZEV producers? Do you think society will be better off? Which consumers (low-income, for example) are most likely to be affected by each policy? … Conclusion (10 points) forget about Tesla for a second, and think about the mentioned governmentâs Drawing from the above aspects of this assignment, summarize the most critical considerations for Tesla given the ZEV subsidy and carbon tax in a few sentences. Your summary should be concise yet comprehensive enough to summarize the key factors you discussed in previous parts. ***You will lose AT LEAST 20 points if you miss ANY of the following:*** 1. This assignment must be submitted in PDF format. Other file types or broken PDF files will receive zero. 2. You have a maximum of 500 words for the analysis. The word limit is strict. 3. About two pages typed, with double spacing and using a font size of 12 points. Handwritten submissions get zero. 4. Exclude headings and citations (if any) from the word count. 5. There are more section specific formatting in the instructions. Make sure to read all carefully. 6. Do not copy the question in your response. 7. No footnotes, no formulas. 8. This is not a research paper, and you do not need to read outside material to complete this assessment, but if you want to include citations, you can. 9. You must submit your PDF on both Crowdmark and Quercus by the deadline. If one submits to only one of the platforms, there will be a 30% late penalty per day. 10. Each section should contain short related paragraphs that use the questions as a guideline. ‌‍‍‍‌‍‍‌‌‍‍‍‌‍‍‍‍‌‍‍Do not write short and disconnected answers. The outcome should look like an essay.