Question

Pick any 2 questions and answer it ( answer should be half page long per question):

11. What is your opinion on price ceilings in the market for gasoline? Price ceilings were last imposed in the 1970s: To help ration gasoline, drivers were allowed to buy gasoline only on certain days. If the car had an even numbered license plate, the driver could buy on even numbered days and vice versa for cars with odd numbered license plates. (On the 31st of a month, anyone could buy gasoline.) But gas stations sold gasoline for only a limited number of hours per day and it typically took 60 minutes to get gasoline. The station would indicate it was selling gasoline by hoisting a green flag; when it stopped selling that day, the station showed a red flag.

12. Healthy economy caused a positive relationship between wages and employment. Explain.

13. Widely scapegoated by the general public and our elected officials as the greedy profiteers responsible for the recent economic collapse, high-income corporate executives have been made potential targets for federally mandated compensation limits. Do you believe that companies should be allowed to determine how much to pay their workers, or if the federal government should get to decide?

14. Why cigarettes and gasoline are taxed so heavily? Should the government place a tax on fast food or junk food? Why might prescription drugs, fruits, and vegetables often be exempt from sales tax?

15. The level of income over which people pay no tax has been rising over the last decade, so nowadays many people’s incomes fall below the level at which the income tax is imposed. In fact, after deductions, exemptions, and credits about 47 percent of all tax filers in the U.S. actually pay zero (or even negative) income taxes, whereas the top 1 percent of taxpayers pay about 40 percent of all the income taxes and the top 10 percent pay about 70 percent. Do you think this trend is fair or unfair? What do you predict will happen if the trend continues?

16. During 2007, as oil and gas prices continued to increase, a growing number of Americans called for the United States to become less reliant on Middle-Eastern oil. Would it make sense for the United States to try to become totally self-reliant in the production of oil? Why or why not?

17. Because wage rates are so low in Africa, why don't Microsoft, Cisco and other major corporations close down their American operations and move to Africa?

Answer 1

Questions answered Q14 and Q 17

Questions 14.

Taxes on cigarettes and gasoline are indirect taxes . The main purpose of imposing more taxes in cigarettes not only to generate higher revenue for government but also reduce the consumption of harmful commodities like cigarettes, as higher taxes will increase the price and decrease the demand, hence reducing it's consumption whereas increasing the taxes on gasoline will help government to generate more revenue for government without increasing income tax , as well as it will reduce fuel consumption , decrease pollution level and encourage people to use more of vehicles that are more socially optimal like using electric car etc. However,  More than half of government revenue of USA comes from gasoline.

-. The fast food or junk food tax or 'fat tax' should be increased by government looking at the health concern because these goods creates health problems specially for younger generation like heart disease , obesity , diabetes etc. which is major concern for government. Increasing the tax will reduce the demand of unhealthy junk food and motivate people to be aware of it's harmful affects and also increase the consumption of healthy foods which are rich in fiber and nutrients.

-Life saving drugs ,fruits and vegetables should be exempted from taxes because these are necessities of life and it act as a health supplements and contains dietary and nutritional properties. Also lower tax will reduce its price and encourage people to have more healthier food. Thus these are exempted from taxes.

Question 17.

Even though wages rates are low in Africa , but still Microsoft companies and other major cooperations are not operating in Africa  because lower wages is not the only reason for operating in a nation , there are many other factors that becomes challenges or hurdles for operating a business in other nations. Other Challenges for working in Africa are -

1. The country's complex environment , multifaceted culture and history brings many challenges for doing business , even World Bank and IFC rank South Africa in 39 the place for doing business.

2. Lack of infrastructure- Infrastructure facilities like getting adequate electricity is a big hurdle  for doing business in Africa and other infrastructure facilities are not adequate in Africa as required by MNC

3. Taxation Policy -. The taxation procedure is also very lengthy and cumbersome in Africa. Time required to complete documents and gain approval is the most taxing  aspect of international commerce.

4. Lack of skilled labour -. The labour is not skilled as required by major cooperations and they have to indulge huge cost on Training of these labour.

Hence ,many hurdles and obstacles makes major cooperations reluctant to pursue business in Africa.