Paying the tax, Management Theories

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As the public's dependence on cell phones carry on to grow, the cost of the phones may be reducing, but the stronghold that telecommunication companies have on the public in regards to contracts and climbing fees is alarming.
As well, all cell phone companies charge about the similar prices, and the consumers do not have much choice in substituting providers. Consumers appear to require some controls in this regard, and the government decides to step in.

  • What is the effect of government intervention in the cell phone market? Ensure that you use graphs to show your point.
  • Is this a good thing for consumers?

On the other hand, the government sees the enhance in cell phone use as an opportunity to make some additional revenue, and it decides to tax service providers.

  • Who is really paying the tax?
  • Show your conclusion on a graph.
  • Do you think that there is a free market for cell phone users? Why or why not?

 


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