Question

Part 3: Production costs and supply and market dynamics questions (5 marks) – Week 3

(Total word count – 200 words)

Complete the following worksheet by typing where possible. Where you are required to draw on the diagram, please either use the insert shapes or draw tools in Word. If you prefer, you can print the relevant page, draw by hand, scan it, and add the scanned image to the document.

Question 1: Refer to figure below. Draw on the figure what the supply curve for solar panels might look like in 2030. Explain your reasoning below. Supply (2000) $ 100 200 300 400 500 Quantity of solar panels (thousands)

Answer 1

Answer) Supply curve depicts the positive association between price level and the quantity supplied. In the above diagram, the relationship between quantity of solar panels and price is being described.

Post 2015 Paris climate agreement, nations bhave started giving special emphasis on renewable energy like solar, wind, and hydro energy. One of the target is to attain 40% of the energy sources from non Fossil fuel based source by 2030.

Relying upon solar energy for energy needs is sustainable for environment. With the rise in the prices of solar panels in the coming years, the producers are incentived to produce more. Hence the relationship between the two variables hold up.