Increase In Fuel Price

Essay by naddydheeCollege, Undergraduate December 2013

download word file, 2 pages 0.0

The hike in fuel price have been an issue when the government recently announced that there will be less subsidies given due to the shortage of fuel around the world. This has caused a huge debate within the country and most are dissatisfied by the governments' decision. In this essay we will discuss on the advantages and disadvantages on the fuel hike that is affecting the economy as well as the consumers.

One of the disadvantages that fuel hike have on us is the impact on cost of living especially on the hike in food prices. This effect the transportation cost as food is delivered from one place to the other. Thus the rising cost of transportation is added into the processing cost that which of course will raise the prices of the final goods especially in the suburb area. For example, fast food company McDonald's distribute their product throughout the country.

They have to raise their goods price to ensure the market margin does not fall below the profit expectation.

Other than that, the disadvantages of the hike in fuel price can cause higher inflation. The inflation rate will increase by four point two percent from an earlier projection of two to three percent later this year, and grow to five point two percent early next year. Though, this is a short-term effect. If the situation can be control through measures and observations in the fuel price by the government it can make the inflation rate drop to three percent later next year. As Malaysians, we together have to face these bitter moments wisely. Confidence in the royal efforts in handling and reduce the need to increase the impression is always there within us. We need to carry out our own responsibilities even when it comes to daily shopping.