ZIS IB Year 2 2013-14

Floods have destroyed of up to 7 million tones of rice in Thailand, and therefore greatly decreasing the supply. Many of the farmers will greatly suffer due to the fact that they get half as much income as they normally would. Due to the supply shock of rice, the price raised a little bit. There is a supply shock in rice in Thailand and therefore the supply curve shifts to the left, increasing the price and decreasing the demand. As the price is higher for every quantity supplied, the producer have less incentive to produce more as they have a smaller profit margin and therefore they decrease production. At the same time, the demand will decrease as the price is higher.

This is an article on the prices of food and the way this affects the supply. Since the year 2012 has been a very warm year, there have been major draughts throughout the world. This article although focuses on the market in America. The draughts have left a major decrease in the production of products. The government's forecast states that the prices of beef would rise 4-5%. Professional analysts although also said that they do not believe that people therefore start buying less, on the other hand they said that it might affect the economic growth over the next years.

This article describes trends in supply of food. In summer 2012, being much hotter than usual and causing the biggest drought in half a century, are causing rises in prices. Groceries such as milk, beef, chicken and pork are expected to rise in price due to the record-breaking weather. Crops, such as corn, of which 88 percent were affected, are to go through major change. General increase of food goods will cause a shift of the curve to the left.

The Article talks about the fact that prices for agricultural products will rise in 2013 due to a heat wave in 2012. This means that the warmest year yet; 2012, will impact the supply of agricultural goods. As there will be less supply, the prices of agricultural goods will increase by up to 5% of goods such as beef and pork. In addition, as the US is a large exporter of agricultural goods, expert say that there has to be a solution to make sure that the global food prices will not spike. Due to the fact that there is a reduction of supply, the supply shift will shift left or upwards. Therefore, there will be less produced at each price and the new equilibrium price will be higher than before. In addition, there will also be fewer goods demanded due to the higher price.

In an attempt to impede on music and film piracy, the Dutch government will implement a tax on smartphones, laptops, and mp3 players (among other devices) as of January 1st, 2013. The tax will be based on the storage capacity of devices, allowing anything from empty CD-ROMs to set-top boxes to be taxed. A maximum fixed levy of five Euros will be placed on devices, some only with a fixed levy of one or two Euros. Thus, the producers and consumers of smaller, less expensive devices will feel the effect of these fixed levies more than those of laptop and smartphone producers for example, as the fixed levies will be a larger proportion of the price for cheaper products. The tax revenues will be distributed among the affected industries. 

Mr. Rangel admitted that he occupies four rent-stabilized apartments in a high-class New York City building. It turns out that in a city with a very tight housing market, Mr. Rangel has fought himself a pretty good deal, thanks to rent-control laws that are apparently aimed at helping the poor and middle class. Mr. Rangel, the powerful Democrat who is chairman of the House Ways and Means Committee, uses his fourth apartment, six floors below, as a campaign office, despite state and city regulations that require rent-stabilized apartments to be used as a primary residence. Mr. Rangel, paid a total rent of $3,894 monthly in 2007 for the four apartments at Lenox Terrace, a 1,700-unit luxury development of six towers, with doormen, that is described in real estate publications as Harlem's most prestigious address. The current market-rate rent for similar apartments in Mr. Rangel's building would total $7,465 to $8,125 a month. 

The Australian government needed, as many other governments do, more revenue. They decide to implement a carbon and mining levy tax. The carbon tax forces firms to pay 23 australian dollars per tonne of carbon dioxide, shifting supply to the left, as carbon dioxide produced forces tax on the firms as well as encouraging them to leave less of a carbon footprint.The mining levy tax, puts a direct ad valorem tax on firms who gathering iron and coal. These taxes have allowed for worker's taxes to be decreased, therefore shifting the tax burden from workers to firms that are enviromentally harming.

Recently regarding the current change in the governments to attempt and reduce the gas emissions, the UK government has started taking action regarding the taxation of the cars. In order to try and promote the more green efficient cars and the hybrids that emit below 130g/km of CO2 will pay nzero on the first year road tax and for the cars that emit less that 100 g/km will also pay zero on road tax. Moreover, in order to discourage people from demanding less of the more heavy emitting CO2 cars such as big SUV the government will start taxing much more heavily those cars. They also will start changing the road tax, they will charge them according to their emissions. In conclusion the lower the emissions the cheaper the tax will be ultimately making the consumers shift their demand from the larger or higher CO2 emitting cars towards the more green and low CO2 emitting cars.

The government wants to increase the taxing on alcohol in New York to make New Yorker's drink less and get them healthier. The Government's Health Department is agreeing that with the new tax increase on alcohol is would help New Yorker's get healthier by increasing taxes for example beer would be taxed 17 cents more and a bottle of hard liquor to 50 cents. New Yorkers original 7.4 cents of taxes on a bottle of beer, 36.9 cents on a bottle of wine and $3.61 on a standard 750-ml bottle of hard liquor.New York has counted 1,700 alcohol-related deaths in 2008 and the Health Department wants to reduce high drinking deaths by 16% and hospitalized alcohol accidents by 19% by the year 2012.

In my article, the Swiss government has decided to increase the tax on cigarette packs by 20 centimes ($0.20). The government has also given manufacturers 3 months to 'adjust' their prices, which also implies that firms are being given time to increase their production (positive relationship between supply and prices). In this case, consumers will not be effected by a price change, as cigarettes are an addictive good. Cigarettes also have a very inelastic demand curve. 

Car owners in Beijing are facing a possible oncoming tax. This is the resort that the Chinese government has taken in an effort to fight the ever-worsening traffic in the city. By fighting the huge amounts of traffic in major cities, the government fights the pollution of air. It is estimated that in 2012, seven million cars will be on Beijing roads (a huge and sharp increase from the 4.7 million in 2010). Other than a tax, the government is hoping to add the restriction of only one car per resident, while non-Beijing residents are only allowed to purchase a car before buying an apartment and a parking permit. Car owners are already paying a 30,000 yuan (S$5,900) for each car they own, yet the Beijing government hopes to have tax incentives for cars with engine sizes of 1.6 litres or smaller.

The taxes on Cigarettes in Chicago are likely to rise in the coming months. The hike would push the combined tax on a pack of cigarettes to $6.67 in Chicago - the second-highest in the nation behind New York City at $6.86 - but would save some 10,300 Cook County residents from premature, smoking related deaths and trigger a 7.2 percent drop in young smokers, Preckwinkle said in the article. It is hoped that the increase in price for cigarettes will result in more and more people refraining from purchasing cigarettes, in an attempt to make people healthier, cut medical costs and make the city healthier. This is an example of VAT tax, or value added tax, on cigarettes.

In 2009 the federal government in the USA decided to raise the cigarette tax from 69 cents to 1.01 dollars which applies to all tobacco products. The tax increase was originally issued to fund a child insurance program but the law was vetoed by president Bush although the tax increase on tobacco products remained. Previous tax increases in the cigarette tax reduced consumption by 4%, however these were lower increases and it is predicted by the Office of Smoking and Health Center that 1 million of the 45 million smokers will quit.

The article Chicago's cigarette tax could approach New York's (by Megan Hickey) focused on the possibility of Chicago increasing taxes on cigarettes. There are several underlying reasons for the proposal; one being a $298 million budget shortage, the other to increase awareness of smoking for health purposes. Chicago already has the second highest tax on cigarettes in the US, the average cost for a pack being $10.25, after New York at $12.50. The total combined tax amount is $5.67 which is made up of a federal tax of $1.01, Cook County tax of $2, Illinois tax of $1.98 and a government tax of $0.68. The possibility of increasing this tax would lead to less consumption of the product, less revenue for tobacco companies and more deadweight loss for consumers and producers. However the Chicagoan government believes that the health benefits gained from less tobacco consumption are far greater than that of cost. To continue this tax hike (continued increase in the tax of cigarettes) would continue the trend of declining tobacco consumption and could decrease the youth in smoking by 7.2%. Not only would the state receive health benefits but the government would be able to increase their revenue through this tax hike.