Passage: A new Indian car on 11th January 2008, Tata Motors, part of India’s Tata group, launched a new model, the Nano. On this day it became the cheapest car available, selling for half theprice of the next cheapest car. For the price of $1000 a brand new Nano could be bought or, for example, a second-hand 1993 Land Rover. The Nano is now produced in Sanand in Gujarat, in a factory which has the capacity to
produce 250 000 cars a year. Tata Motors employs 2200 workers, including car designers, tomake the Nano at the factory. With cars becoming more sophisticated, and themanufacturing process becoming more complex, the production process at the Sanand factory, and other car factories in India, is becoming more automated. Robots are nowundertaking a number of functions that before were undertaken by humans.
The car was intended initially for the home market. It was hoped that millions could be sold in India. The firm also planned to export the car to Latin America, South-East Asia and Africa. Although selling the car at such a low price made car ownership more affordable for more people, there were still many millions of people who would like a car, but did not have the income to buy one.
The sales of the Nano have not yet met the hoped-for level. In 2014, only 19 000 Nanos were sold. A year later sales rose, but only to 24 200. The cost of producing the Nano was higher in 2016 than its selling price which was then $1500. The disappointing sales and loss being made, led some people to suggest that Tata Motors should devote fewer of its resources to Nano cars and more to other cars. Others point out that Tata Motors could produce more types of other cars and save costs by closing a number of its factories, as most are working with spare capacity.
From this source material
a) Identify an example of the factor of production labour used in producing the Nano.
b) Calculate the average number of Nano cars produced per worker in 2015.
Hint: Production per worker=Total production of cars/total number of workers

c) Explain what was a possible opportunity cost of buying a new Nano car in 2008.
d) Identify two examples of the economic problem.
e) Analyze, using a production possibility curve, Tata’s output of cars in 2015.
f) Discuss whether a car is a capital or a consumer good.
g) Discuss whether the quality of workers used in producing Tata cars is likely to increase in the future.