1. Pick a recent news article from a major newspaper that contains content amenable to microeconomic analysis.

2. In the first short paragraph you might outline the main points from the article that you are planning to analyze. You should identify the key microeconomic issue(s) discussed in the article. Do not summarize the article.

3. Using the tools (including graphs) and terminology learned in this microeconomics course explain the economics “behind” the article. Most news articles rarely, if ever, mention the terms or models we discuss in class even though economics is often very relevant to the article’s subject matter. The article simply describes something that is happening in the world. This is your opportunity to “think like an economist” to show how economic analysis can inform our understanding of the issue discussed in the article. If you can identify and discuss even one or two economic elements in a news story, then you may understand far more about the issue than most other readers, who only read the words as they are written on the page.

4. The length of the analysis should be between 300 and 600 words (a word count should appear at the end of the analysis). The analysis should be typewritten, although you can neatly hand-draw any graphs that you might need for your analysis. You must attach a copy of your news article to your analysis.

5. Carefully proofread for spelling and grammatical errors. Your paragraphs should be well-written.

6. Your grade for the assignment will be determined by both the quality of the analysis and the quality and care of the writing.

This assignment should be fun for you. It is an opportunity for you to use the material you have learned thus far in the course to discuss and evaluate important microeconomic issues and policies affecting our lives. This is an ideal opportunity to demonstrate to me in writing your ability to use the skills you are learning.

Subsidies

1. Explain the meaning of subsidies.

2. Explain some reasons why governments would give subsidies.

3. The government is considering giving Rs. 20 subsidies per KG of rice production.