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Please read all the instructions given below very carefully and then answer the questionsBusiness report guidelines Covering page – ensure you include your name, Student ID and word count. Executive...

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Please read all the instructions given below very carefully and then answer the questionsBusiness report guidelines Covering page – ensure you include your name, Student ID and word count. Executive summary. Table of Contents (use the Word automatically generated table of contents). Body of report with answers to each of your questions, including headings for eachquestion and part of question. References: when you use another person’s wording or another person’s idea you needto include an in-text or embedded reference and then include the full reference in theReference List. Refer to the library’s online referencing guide: Ensure that your report contains a minimum of six academic references (standardwebsites are accepted; blogs are not to be used to support your answer). Use APA 6 reference style. Use a minimum 11 point font. Use page numbers. Appendices (only if required).The weighting on the marks are evenly distributed, but we mark according to the rubric,which is: Effective explanation of the concepts covered to demonstrate understanding andknowledge of the core areas of Microeconomics (30%) Application of core concepts (25%) Quality of the answers (20%) Managing Time (25%)Table of ContentsEnsure you use the Word automatic table of contents with style guides.Guide to constructing a Table of Contents: to using heading styles: numbersPage numbering starts after the table of contents (i.e. page 1 will contain your first answer).You should not have a page number on your covering page.Your table of contents page should have the roman numeral “i”.Assessment 1 – T2 2020:Because of the quarantine restrictions due to Covid-19, there has been a considerable lossof employment in Australia. The standard of living for many Australian residents has beenaffected. House prices have decreased by approximately 30% in the major states ofAustralia. It appears that the housing market has become a buyers’ rather than a sellers’market.Question 1:1. Does the Australian housing market favour buyers or sellers in the Australian states andTerritories? Is the change widespread across Australia? Do individuals now have buyingpower in the housing market, given the current tight household economic conditions?Provide evidences and diagrams to support your answer.Question 2:2. Will decreasing house prices affect the supply of and demand for housing in Australiaand how will this impact price elasticity of demand for housing? Explain using diagramsto support your answer.Question 3:3. Will the consumer’ welfare increase or decrease due to this change in the housingmarket? Will there be a loss of welfare? Who would the change affect more? Willoffering subsidies or grants cause a change in supply and demand in the housing market,irrespective of whether it is a buyers’ or a sellers’ market? Use appropriate diagramswhilst explaining your answer.
Answered Same Day Jul 09, 2021 ECON6000


Komalavalli answered on Jul 12 2021
139 Votes
Assessment 1- Report: Microeconomics – ECON6000
Name: Pete
Student ID:
Word Count: 2170
Table of Contents
Executive summary:    3
Question1    4
Housing Price:    4
COVID 19 impact on Home equity:    5
Nominal housing price forecast by Reserve bank of Australia:    6
Nominal housing price year end growth forecast by Reserve bank of Australia:    7
Most and least expensive state in Australia based on Dwelling value    9
Question 2    11
Demand and supply situation of Housing market    11
Price Elasticty of Demand for housing    12
Question 3    13
Change in consumer welfare due to decrease in housing price    13
Executive summary:
This study focuses on the impact of Novel corona virus out
eak on Housing market. Restrictions such as lock down, social distancing imposed by Australian government lead to loss of employment among several individuals, income earnings were also affected. This resulted in low real income among the people. Low real income level decreases the demand for housing among the people leads to decrease in price of house in the housing market. Cu
ently price elasticity demand for housing market is inelastic which indicates people will respond less or demand increase relatively low along with a decrease in price level of housing in the market. This reduces consumer wealth by decreasing their purchasing power. Providing demand subsidies to increase the consumer expenditure, the demand for housing will increase. At subsidize rate people will tend to purchase more quantity of housing, this will increase their welfare in the economy.
Housing Price:
    University of Melbourne, department of finance predicted the impact of Covid 19 on housing price. They forecasted the housing price for June and September Quarter by using the data from financial companies listed on the Australian Stock exchange market.
    Source: The impact of COVID-19 on Australia's housing market, University of Melbourne
They predicted that property of residential prices in Brisbane was expected to fall by 3.7 per cent in second Quarter and 1.8 per cent in Quarter four. For Adelaide the price is forecasted to fall by 2 per cent in June Quarter and in September Quarter it is expected to fall by 0.8 percent.
Housing price in the city of Sydney is expected to fall by 4 per cent in second quarter and by 2.5 per cent in fourth quarter. For Melbourne it is expected to fall by 5.6 percent in quarter 2 and by 2.8 per cent in quarter 4.Perth housing price is expected to decrease by 5.8 per cent in quarter June and 3.8 per cent in September quarter.
Across all cities price were forecasted to fall by 4.4 per cent in June and by another 2.3 per cent in September quarter of 2020.From above graph it is clear that the COVID 19 impact is expected to be more on Melbourne, Perth and less on Brisbane and Adelaide.
COVID 19 impact on Home equity:
Source: The impact of COVID-19 on Australia's housing market, University of Melbourne
Impact on home equity is calculated by the difference between a home value and the amount of debt bo
owed against it. They have used data from 2018 Household, Income and Labour Dynamics in Australia (HILDA) survey. Home equity tells us about how much cash owner of the house will receive from buyer after repaying all outstanding debts on the home while selling it to the buyer.
From above graph of predicted percentage changes in home equity by state, for Sydney, Brisbane and Melbourne they predicted home equity will fall by 10 per cent or more and for Adelaide this impact is less severe compared to Perth of one quarter forecasted impact on home equity is fall by around 20 or more than 20 percent. More impact on Perth city of Australia on housing price is due to housing markets are more exposed to stock price movements and average household debt in Perth are relatively high to home values.
Nominal housing price forecast by Reserve bank of Australia:
From above forecasted graph we can see that the actual nominal housing price is at increasing trend from 2010 to 2022.Without COVID 19...

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