E5110" 3: 45 marks :Cycling Promotion Fund (CPF), Australia's peak bicycle promotion group, said because of the COVlD-19 pandemic use of bicycle reased by 10% last year, 4% more than expected. As a result, CPF is requesting the government to provide more Incentives t :ourage cycling as a means of transport. 3. Write a persuasive ecanomic report to support CPF's request. Your report should include discussions ofIthe role of tha following: i. the income elasticity of demand for bicycles. [10 marks] Ii. the cross-elastich of demand between bicycles and motor vehicles. [10 marks] iii. factors other than the price of petrol that might have influenced or Influence demand for bicycles. [10 marks] __ illustrate your report with demand and supply diagrams. b. Suppose upon reading your report the government decides to pay a subsidy to bicycle producers. Use the demand and supply diagram to explain the impact of the subsidy on the equilibrium quantity and price of bicycles. and the efciency of q the bicycle market. [15 marks]