Economic

JESTION 1 (Total: 10 marks) his question assumes that daily life has returned to the way it used-to-be before the vid-19 pandemic.) ppose that technological advancements in high-speed rail transport has led some ople to substitute rail travel for driving to their holiday destinations. A study by ofessor Q of Nomash University found that the reduction in car travel led to fewer ad traffic accidents and deaths per year, since rail travel is safer (per passenger metre) than car travel. Using the logic suggested by Professor Q, illustrate and explain with demand and supply curves how a rise in wages paid to all rail-transport employees would affec the number of road accidents and deaths per year. (5 marks) (Hint. clearly identify which market you will use to analyse the question.) How would your conclusion to part (a) change if, in addition to the rise in wages mentioned above, there is a significant decrease in rental rates for minibuses or passenger vans? Illustrate and explain your reasoning. (5 marks)ClUE 3110" 1 [Total: 10 marks] (This question assumes that deity fife has returned to the way it osedtobe before the Covr'd f9 pandemic.) Suppose that technological advancements in high-speed rail transport has led some people to substitute rail travel for driving to their holiday destinations. A study by Professor 0 of Nomash University found that the reduction in car travel led to fewer road traflic accidents and deaths per year, since rail travel is safer (per passenger kilometre} than car travel. a} Using the logic suggested by Professor Q. illustrate and explain with demand and supply curves how a rise in wages paid to all rail-transport employees would affect the number of road accidents and deaths per year. [5 marks} tHr'nt. clearly identify which market you will use to analyse the question.) b} How would your conclusion to part (a) change if. in addition to the rise in wages mentioned above, there is a signicant decrease in rental rates for minibuses or passenger vans? Illustrate and explain your reasoning. {5 marks}