Question 1 You were an analyst of a consultancy firm and preparing a market analysis of hard-shell luggage for your client. The following information is collected for the analysis. News Extract 1 Luggage giant Samsonite suffers first-quarter loss of US$787 million as Covid-19 brings global travel to a standstill By South China Morning Post, 15 May 2020 Samsonite International suffered losses of over US$700 million from January to March, and warns coronavirus will hit full-year earnings, as the world's largest suitcase company reels from a pause in global travel. The suitcase brand - which owns the likes of Tumi and American Tourister - recorded a net loss of US$787.3 million in the first three months of 2020, compared to a profit of US$22.8 million in the same period last year. Net sales dropped 27.7 per cent, or US$230 million, over the same time frame, to US$601.2 million. "The near-complete halt in travel and tourism worldwide has adversely affected the group's performance in the first quarter of 2020, and is expected to continue to impact our business for the remainder of 2020," said Kyle Gendreau, chief executive officer, in a statement.... (Source: https://www.scmp.com/business/companies/article/3084507/luggage-giant- samsonites-suffers-first-quarter-loss-us787 and with modifications) News Extract 2 After the first client meeting, you recognize that except travelling trend, market price of Acrylonitrile Butadiene Styrene (ABS) is also an essential information for your analysis, where ABS is the main materials used to manufacture hard-shell luggage. Thus, you refer to the following news extract. Cost Lowered, Inventory Rose, China ABS Market was in Bad Situation By SunSirs, 7 January 2021 The domestic ABS market in December 2020 recorded prices of various brands decreased to a certain extent. As of January 1, 2021, the mainstream offer price of general ABS was about 15,750 yuan / ton, down 18.18% from the beginning of December, 2020. (source: http://www.sunsirs.com/uk/detail_news-4044.html and with modification)(8) lb) (C) N) Consider the information of News Extract 1 only. Use 1 to 2 sentence(s) to summarize the key information before introducing the factor affecting the hard-shell luggage market. Use a demand- and-supply analysis to explain the effect on the equilibrium price and equilibrium quantity of hard-shell luggage. No demand-and-supply diagram is needed but you need to describe how the curve(s) shiftls) in your written explanation. (5 marks) Consider the information of News Extract 2 only. Use 1 to 2 sentence(s) to summarize the key information before introducing the factor affecting the hard-shell luggage market. Use a demand- and-supply analysis to explain the effect on the equilibrium price and equilibrium quantity of hard-shell luggage. No demand-and-supply diagram is needed but you need to describe how the curve(s) shift(s) in your written explanation. (7 marks) Considering all effect identified in your answer of part (a) and (b), what are the combined effect on the equilibrium price and equilibrium quantity of hard-shell luggage? (2 marks) Suppose your client reports there is a drop in quantity sold in the hard-shell luggage market. How could this observation be possible? Explain with ONE demand-and-supply diagram. (6 marks)