Articles Analysis Essay on Economics

Introduction

Economics is a field of business that focuses on how economics agents behave and interact and how economies work. It is divided into microeconomics and macroeconomics. Microeconomics focuses on the basic elements in the economy such as the interaction of agents and their markets and the outcome of such interaction. Conversely, macroeconomics analyzes the economy in its entirety. It covers consumption, investment, production and other issues that affect it. Economics play an integral role in every moment of our lives since it examines choices, how and why we make them and their impact on business. This article aims at discussing some of the economic concepts covered in different articles over the recent past.

Kenya Power’s Bid to Charge Consumers Higher Tariffs Flops

The article discusses how Kenya power and lighting company (KPLC) is planning to increase consumer tariffs from July and the actions that the government has taken over such a move. The company is the main producer of electricity in Kenya and it enjoys monopoly hence it can dictate electric prices at will. Over the recent past, the company sought the approval of Energy Regulatory Commission (ERC) over its intention to raise charges in order to cover the rising cost of operation. However, the ministry ruled out any increment on the tariff, hence blocking the company from opening a new revenue. There is a clear evidence of monopolistic force is this article when the company wishes to raise the power tariff. The consumers would have had no option but to pay if this request had been granted. However, the government owning 50.1% of the company keeps the company in check from exploiting the consumers. The article clearly depicts how monopolistic companies may raise the prices of services to their advantage, placing the consumers on the wrong side of a bow. Just as in economics, monopolistic companies are controlled by the government for instance in the Kenya power company the government has the majority shares. Other forms of control of monopolies are by regulations through taxations, by anti-monopoly laws and policies to prevent unfair prices and discrimination against different consumers and also contracting (NEVILLE OTUKI, 2016). The graph below illustrates effects of monopoly on prices as discussed in the classroom.

Wheat Flour Prices up on Global Shortage

The article discusses how the prices of wheat flour have started going up as a result of the shortage of the commodity in the market. Local traders have been forced to increase the prices of wheat flour so that they can match with international prices. The high global prices of the commodity are attributed to the shortage of the commodity in the market.

Mapping Retail in a Sprint/T-Mobile Merger - Kansas City Business Journal

The article discusses the potential merger between Sprint Corp. and T-Mobile. This would reduce the number of companies producing the same goods in the market hence the market would be oligopolistic. The competition will be reduced due to the reduction in the number of producers. The merger would result in the closure of some stores that would be rendered useless by two companies.

Air Traffic Soars but There Is Turbulence on the Ground

The article discusses the challenges that Indian airports have been facing over the recent past. These challenges are a clear indication of the market failure of the airports. Most airports in India have become synonymous with congestion, delays, and queues. This causes delays in all other sectors of the economy.

The Effect of Excise Tax Increases on Cigarette Prices in South Africa

The prices of tobacco vary from one country to another depending on the amount of tax of each country. High taxation of foreign tobacco is mainly used in reducing the number of people that use the drug. This depends on how tax increase impacts the retail price of the product. In return, locally produced cigarettes sale highly as compared to the foreign cigarettes upon which discriminatory tax have been applied.

References

Air traffic soars but there is turbulence on the ground. (2018, May 1). Retrieved from https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/air-traffic-soars-but-there-is-turbulence-on-the-ground/articleshow/63984076.cms

ANDAE, G. (2018, March 25). Wheat flour prices up on global shortage. Retrieved from https://www.businessdailyafrica.com/markets/commodities/Wheat-flour-prices-up-on-global-shortage/3815530-4357106-iujcb8z/index.html

The effect of excise tax increases on cigarette prices in South Africa. (2018, January 1). Retrieved from http://tobaccocontrol.bmj.com/content/27/1/65

Mapping retail in a Sprint/T-Mobile merger - Kansas City Business Journal. (2018, May 4). Retrieved from https://www.bizjournals.com/kansascity/news/2018/05/04/mapping-retail-in-a-sprint-t-mobile-merger.html

NEVILLE OTUKI. (2016, May 18). Kenya Power's bid to charge consumers higher tariffs flops. Retrieved from https://www.businessdailyafrica.com/corporate/Kenya-Power-bid-to-charge-consumers-higher-tariffs-flops-/539550-3208200-6dygao/index.html