Building economics tutorial 1
- 1. Building Economics Tutorial 1 Group members: Adam wong (0322520) Michelle Tung Man Kaye (0324175) Alan Chung JiaZen (0321487) Chin Qi Yu (0324094) Calvin Wong Ping Ket (0322481) Koh Ee Sing Muhammad Fareez (0322961)
- 2. Question 1: What is Building Economic? Building economics is the study of the application of the technique and expertise of economics towards construction projects. This study concerns the use of the available resources to increase the rate of growth of the construction work in the most efficient manner, building a suitable and appropriate shelter for man.
- 3. Question 2: Describe and explain the four (4) characteristics which separate the construction industry from other industries. 1. Organisation of the construction process ❖ Temporary multi-organisation ❖ Site Production, fixed position manufacturing 2. Structure of the industry ❖ One of a kind nature of projects, made to specific customers, an unique product ❖ Each project often represents a large proportion of a single contractor work order in any year causing substantial discontinuity to production function 3. Method of price determination ❖ Product rooted in place 4. Physical nature of the product ❖ Final product is often large and expensive and may be required over a wide geographical area.
- 4. Question 3: Describe and explain the four (4) categories of these resources. Labour - Households supply their labour to firms that demand labour and firms pay workers for their time and skills. The return to the resource owner is wages. Capital - This Refers to any man made resources, including building, plant , machinery, equipment, infrastructure and tools. The return to the owners of capital is called profit or interest. Land - This refers not only to actual land but also the space and the mineral contained in the earth crust and all natural resources. The return to the source owner is rent; Enterprise - Entrepreneurs who have the special ability to combine the other three types of resources with the return of profits.
- 5. Question 4: List down five (5) importance factor of construction industry in the country’s economy - Scale of the construction industry - Employment - Investment - Government - International
- 6. Question 5: Provide 2 examples of government policies which influences the supply and demand of the construction industry. 1. Sales tax and services tax (SST) - Presently, Malaysia has consumption taxes in the form of sales tax and service tax, which are imposed on specifically identified classes of goods and services, respectively. In the present of SST, the supply and demand of products will decrease as the cost of the products is rising.
- 7. Question 5: 2. Export promotion industrial policy - Malaysia has implemented export promotion industrial policies extensively for more than 40 years. This has assumed the form of the granting of tax incentives, the establishment of export processing zones and industrial areas. For example, imported building materials incur import duties while building materials gets a large rebate on excise duties.
Editor's Notes
- #6: Slide 17 - introduction