Impact of Fuel Prices on Daily Used Commodities: Evidence from Pakistan (2008-2012)
The aim of this report is to understand the importance of affect of oil price on daily used goods. Globally the oil Prices are regarded to be a very significant causal factor of an economy. The volatility in oil prices surely has an impact on macroeconomic indicators. The increment in the oil price passed on to the petroleum commodities and directly hits the industry, consumer household, and the government. However from production perspective companies have to curtail the rise in the unit prices to maximize the profit and sustain their margin levels. We know the importance of fluctuations in the oil prices as increase in 1 $ per barrel of oil cost use more in our daily life whether its food, health, education or anything that is linked with people’s life. The resilience of Pakistan economy has been examined various times one crisis after another. The Pakistan economy has observed large number of domestic and external shocks from year 2007 onwards. The abrupt increase in the oil and food prices in the international market has hit repeatedly the macroeconomic strategy. This study is a quantitative research based on a combination of primary and secondary data. In this thesis time series data on monthly bases collected from January, 2008 to December, 2012 of oil prices as an dependent variable and CPI, SPI and WPI as a independent variables to measure its correlation. A questionnaire survey is also developed to identify and understand consumer’s perspective. Statistical tools used in this paper are Pearson product-moment correlation coefficient and Regression Analysis. The study shows strong relationship between oil prices and CPI, SPI and WPI. Whenever oil price increases it also hit inflation due to which increase in the price of daily used commodities and burdens comes on the shoulder of citizens of Pakistan. The alternate energy source is the only option to XII tackle with the situation. Government should take immediate actions and develop short term as well as long term plans to run the healthy economic cycle.
Volume (Year): (2013)
Issue (Month): ()
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