logo

BUS702 Economics for Managers : Assignment

7 Pages843 Words85 Views
   

BUS702 Economics for Managers (BUS702)

   

Added on  2020-04-29

BUS702 Economics for Managers : Assignment

   

BUS702 Economics for Managers (BUS702)

   Added on 2020-04-29

ShareRelated Documents
BUS702 2017
BUS702 Economics for Managers : Assignment_1
ContentsQuestion 1.............................................................................................................................................2Question2..............................................................................................................................................4Figure 1 Price Elasticity of Demand.......................................................................................................4Figure 2 Effects of Price Elasticity of Demand........................................................................................5Figure 3 Effects of Increased Government Spending on Aggregate Demand........................................6Figure 4 the IS-LM (closed economy) Model.........................................................................................7Page 2 of 7
BUS702 Economics for Managers : Assignment_2
Question 1Elasticity of demand would be able to help understand the :degree of responsiveness” that each of the above mentioned food categories would show to changes in price achieved by way of subsidies or increased taxes .The price elasticity for high calorie food intake is negative and high. Hence, taxing high calorie fruits and vegetable would lead to a comparatively large amount of decrease in demand.. Taxation of such fruits and vegetables may increase government revenues marginally. However, more information is needed to be able to determine the extent of taxation.On the other hand, high calorie grains, pasta , bread, sweets and sugary snacks and dairy products show low and negative price elasticity of demand. Taxing these products may not help decrease their consumption greatly. However, the health benefits accrued from taxation of sweets and sugarysnacks seems to be large, even if the consumption decreases to a small extent. Hence, the group of High calorie sweets and sugary snacks should be taxed to a great amount. Subsidies for sweets and sugary snacks should also be encouraged only based on the DALYs. The health benefits of subsidizing low calorie fruits and vegetables are not clear and the price elasticity of demand being low, the likelihood of significant increase in consumption is also low. Hence, subsidising this category may lead to the maximum loss in public budgets and should be avoided. Subsidies on low calorie dairy products may help increase their consumption and based purely on price elasticity of demand analysis, would be a good investment.Page 3 of 7
BUS702 Economics for Managers : Assignment_3

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
BUS702 Economics for Managers
|7
|903
|35

BUS702 Economics for Managers - Assignment
|7
|858
|87

The Economic Theory Study
|8
|1477
|34

BUS702 Economics For Managers Assignment
|7
|870
|132

BUS702- Economics for Managers
|4
|790
|29

Economics Assignment on Price Elasticity
|6
|988
|170