Principles of Microeconomics (ECON-103) Only PDF and MS Word files are acceptable. The size of the Answers is 1200 words or 200 words per question. Important marking criteria are readability and the flow of arguments. For high marks, you should find further information on the Internet. Each Assignment will be checked for plagiarism via SafeAssign to detect any kind of similarity (e.g., Using ChatGPT or any other AI tool or directly copying any materials from the internet or your classmate, etc.). Please include your name and student ID on the answer paper. Understanding of an Economy on a Micro Level Answer the following questions on what we need to know about trade. 1. What are the fundamental forces driving most of the international trade? (5 Marks) 2. Is free trade based on competition? (5 Marks) 3. Will domestic firms become competitive if the government protects them from international competition? What is the downside of protectionism? (5 Marks) Please carefully watch the following video and answer the given questions: Title of the video: The minimum wage: does it hurt workers? The link: https://www.youtube.com/watch?v=8H4yp8Fbi-Y 4. What does the law of demand and supply tell us about a (binding) price floor on wages? (5 Marks) 5. How does the elasticity of labor demand affect the unemployment rate under a minimum wage? (5 Marks) 6. Under which circumstances can a minimum wage lead to a lower income for workers? (5 Marks) 1 Category Poor ≤69% Evaluation Rubric for ECON103 – Major Assignment Fair 70-79% Good 80 -89% Excellent 90-100% Question 1 Discussion Question 2 Discussion Question 3 Discussion Question 4 Discussion Question 5 Discussion Question 6 Discussion Shows minimal understanding of fundamental forces and may be inaccurate or vague. Understanding is minimal or lacks coherence, failing to provide a clear argument or perspective. The explanation is unclear or inaccurate or identifies some downsides of protectionism but may lack depth or overlook certain aspects. Understanding is minimal or lacks coherence, failing to provide a clear argument or perspective. Minimal understanding or lacks coherence, failing to provide a clear argument or perspective. Explanation is unclear or inaccurate, or the circumstances leading to lower income are not properly elaborated. Attempts to explain fundamental forces but lacks coherence or detail. Attempts to explain competition and its relation to free trade but lacks coherence or detail. Attempts to explain the relationship between government protection and competitiveness but lacks coherence or detail. Attempts to explain the effects of a binding price floor but lacks depth or clarity. Attempts to explain the relationship between labor demand elasticity and unemployment under a minimum wage but lacks depth or clarity. Attempts to explain circumstances leading to lower income under a minimum wage but lacks coherence or detail. Shows a solid understanding of most fundamental forces with some elaboration and examples. Provides a good understanding of whether competition is related to free trade or not with some elaboration. Provides a good explanation of the relationship between government protection and competitiveness with some elaboration. Provides a good understanding of the effects of a binding price floor on wages. Provides a good understanding of the relationship between labor demand elasticity and unemployment under a minimum wage. Provides a good explanation of circumstances leading to lower income under a minimum wage. Clearly explains the fundamental forces driving international trade, providing relevant examples, and illustrating how these forces influence trade patterns. Offers an insightful understanding of whether free trade is based on competition or not, considering various perspectives and arguments. Clearly explains whether domestic firms will become more competitive or less under government protection. Clearly Identifies and articulates the downside of protectionism. Offers an insightful explanation of the impact of a binding price floor on wages, discussing changes in quantity demanded and supplied, market inefficiencies, and potential unemployment. Offers an insightful understanding of how the elasticity of labor demand influences the unemployment rate under a minimum wage, considering factors such as labor market dynamics and adjustment mechanisms. Clearly explains the circumstances under which a minimum wage can lead to lower income for workers, considering factors such as labor market conditions, wage elasticity, and employment effects. 2