Case Study Eco
Case Study Eco
Submitted by: Kay Ann A. Agoyaoy BSA2 11:30-12:30 MWF Submitted to: Professor Mosquera
Case Study 1:
2. How does NFA intend to raise the price of palay to its targeted support price level? Illustrate.
Usually the private sectors hold or control the supply of the palay when there is a high demand and sell it in higher cost. And they will supply more products when there is a low demand. The reason is that as the price increases, the quantity supply of the product increases and as the price decreases the quantity supply decreases.
3. Is the position to import rice compatible with the intention to support palay prices?
No, because there is no local rice shortage so we dont need to import rice. And the importation of rice will affect the agricultural economy of our country.
Case Study 2:
1. Is the proposed sales tax progressive or regressive? Who will be burdened most and why?
The proposed sales tax is regressive. It is said to be regressive because the consumers, especially those with low-income, will definitely burden greater tax. The sellers or the traders will pass the tax burden to the consumers by adding the additional tax to the normal or original cost of the cigarettes. For example, the original price is P2.00 and let say that the tax rate is 12% therefore the total price of each cigarette including the 12% tax is P2.24.
Case Study 3:
1. Is the demand for beer price elastic or inelastic? Explain and illustrate.
The demand for beer is said to be inelastic. The reason for this is the consumer did not respond to the changes of price. And because of additional taxes in beer products the sale of beer is continuously decreasing that may result to losses in the part of the producers.