¶ … tells that Volkswagen has been found, and admitted to, cheating on emissions tests for its vehicles. That cheating had shown that diesel was cleaner than unleaded, which in turn resulted in favorable tax treatment for diesel. This in turn increased the demand for diesel products, as they were cost-competitive versus gasoline cars. With the admission that Volkswagen falsified these tests, leading to the conclusion that unleaded gasoline is the cleaner of the two fuels, there are significant implications including the possible reversal of tax policy in the EU away from favoring diesel as a fuel source for automobiles.
The market for fuels is typically subject to various regulations, and emissions are one of the regulations that govern this market. Tax policy is based on multiple factors but in Europe in particular tax policy is based on the desire to control emissions. Tax policy moves the fuel market out of equilibrium, and in this case tax policy was moved to favor diesel. This in turn encouraged the sale of diesel vehicles, as these vehicles were cheaper for consumers to operate. Thus, diesel vehicles were better value to European consumers, and ultimately captured a very high market share.
Should tax policy favoring diesel...
Microeconomics The most common way of deciding between these two options is through capital budgeting. If the two decisions are mutually exclusive, a net present value analysis will determine which of these options is better for the store in the long run. This type of analysis involves calculating the incremental cash flows that derive from the decision, and then discounting them back to the present day. The up front cash flows
Microeconomics The class Principles Microeconomics. text book Principles Microeconomics N. Gregory Mankiw. paper answer questions. Final Project Following a description final project ECO-112. The project parts, answered complete project. Principles of microeconomics: Products used in daily life Product 1: A Starbucks latte Product description and usage The Starbucks latte is a coffee beverage made with espresso and steamed milk. On the company website it is described as "the original coffeehouse classic. And like most classics,
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