If the price of cigarettes increases, not only will the quantity of the cigarettes fall but simultaneously it may also affect other commodities. The aspect of income elasticity will also be incorporated here, which will show us whether income and demand for cigarettes move together or not.
Lately the world economy has been more concerned about the harmful effects of smoking. Though, from time immemorial, people are trying to resort to drugs or other narcotics, this gives them a tranquilizing effect in their minds. One of the most common intoxicants is a cigarette, which serves as the escape route from their harsh realities of life. In the recent times, smoking has taken the shape of an epidemic, which is affecting not only people’s minds but also their lives. Many steps have been taken, such as campaigns showing how smoking is injurious to heath or health programs to restrict the usage of cigarettes per day. In spite of this, people are reckless to quit smoking, as they find no perfect substitutes of it. In regard to this the governments of all the countries are starting a new tax regime especially US government. This consists of an increase in the price level of cigarettes by the imposition of proportional tax or a lump sum tax. By proportional tax structure, a particular rate of tax is imposed on price of cigarettes. In respect to the US governments the tax structure usually takes the form of excise or sales tax. Here, a fixed rate of cents is imposed on the price of cigarettes. Let the tax rate‘t’ be imposed on the price of cigarettes, ‘p’, the new price is now ‘p (1+t)’. According to the law of demand, the price and demand of a normal good are negatively related. Here, cigarette is a normal good since with the fall in price, smoking becomes more attractive and popular among the individuals. The following diagram shows the ...
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Following are some of these strategies. Waiting Line or Queuing Theory: Waiting line models are useful in both manufacturing and service area. By analyzing queues in terms of waiting-line length, average waiting time, and other factors, helps an operations manager to gain vital information on service systems, maintenance activities and shop-floor activities.
Quantitative researches typically specify the number of research participants as sample from the population and display the data on numerous events taking place or biological variables. There is a statistical section in the research that reflects the cause and effect relationships.
As Bonner, Wiggin, and Incontrera (2009) point out, through quantitative easing, a central bank generally purchases different types of financial assets to pump a fixed volume of money into the economy with intent to promote economic activities and thereby to boost growth rate (p.
Quantitative easing has many negative effects on consumers, especially those approaching retirement and those who have savings. This paper focuses on how it influences change in food prices. In 2011, the president of Euro Pacific Capital Peter Schiff states that the instability in the commodities market is influenced by the nations that print much money and demean their currencies.
Economic and finance ministers from the G20 nations are conducted a meeting in Argentina to discuss the increasing volatility among food and commodity prices. Food prices are no longer depended on the traditional economic motion of supply and demand in a market.
When a child learns a chapter of science from mother then it becomes a want for the service of education. If that very student goes for a private tuition, then it becomes a demand because certain money has to be paid to the tutor. The father of economics Alfred Marshall explained the Law of Demand.
This is because according to Mentzer and Moon (2004), forecasting is an important mechanism for matching demand and supply and could therefore be used to undertake sales and operations planning for businesses. Meanwhile, demand and supply matching has been said to be an important element in planning and decision making for businesses (Mentzer and Moon, 2004).
N .Gujarati, econometrics can be defined as social science that uses theory in economics and formulae in statistics and mathematics to analyse the economical phenomenon. 1
Here the integration of logarithm of national 100 index value and the logarithm need to be estimated.
As both numbers characterize the exports of the same industry and may be oriented towards the same potential market, the change in the quantity of passenger cars exported may have an influence on the quantity of commercial vehicles exported.
- there is non-linear relationship between the variables (as seen from the scatter graph non-linear models may be more efficient in this case, though no clear pattern is observed and the linear regression model should address the relationship adequately);
nalysis for optimal pricing, comparative analysis of costs and revenues for financial viability, comparative analysis of profitability across branches, and analysis of effects of meeting human resource motivation needs on human resource output.
Demand for commodities is a
3 Pages(750 words)Research Paper
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