Topic: Would the simultaneous

increase in the prices of

gas/Water/Electricity be greater than if
they occurred separately?

Level: Semester 5
Lecturer:
Date: 30th of June 30, 2014

RESEARCHERS:
Yadi Ikechukwu ANU12210098
Nkamare Michael ANU12210094
John Dah
Becky
Beatrice

BACKGROUND
Inflation is persistent increase in prices of goods and services. It can
also be explained as the situation where a unit of currency is able to
purchase fewer goods.
There are many drivers of inflation. Good examples include - higher
taxes, printing of more currency, increase in wages, increasing
import prices
By 10 June 2014, there is going to be an increase in the prices of
water, electricity and gas.
Historically, an increase in gas prices has led to a level of price
increments in transportation, food prices among (Heinberg, 2011).
Electricity is a vital part of the economy. Without it, perishable food
items like chicken, eggs, meat would quickly get spoiled. Water
and soft drinks are normally served cold and thus require almost
constant refrigeration to please the customer.
Water is very vital to life. Water is used to bathe, cook, wash and
drink.

STATEMENT OF PROBLEM
Ordinarily, an increment in the prices of one of the three items i.e.
water, electricity and gas would cause a noticeable change in prices
of other goods. With the three factors being increased at the same
time, it is possible that the effect could be greater than if they were
increased separately.

If this occurs, then, there could be devastating blow to the

Ghanaian economy. It could even cause a minor depression as
people would start to ration their purchases and walk or use
bicycles instead of pay for transport until the economy destabilizes.
As a result, its possible for a more than 30% inflation rate to occur.
The effect on transportation could be at least 30% increase in prices
all across the country. Also an above 30% increase in food prices.

OBJECTIVES
We would seek to discover the immediate effect of the price
increases. We would want to discover if the three price hikes done
at the same time would be less than if they were increased
separately.

RESEARCH QUESTIONS

What short term percentage increase would result?

What long term price increase would result?
Would inflation be single or double digit?
Would the price increment be uniform amongst sectors?
Would the three items increasing at a time cause a higher
inflation than if the increases were spaced?

SIGNIFICANCE OF THE STUDY

For students, this research would stimulate our intellectual curiosity.
In addition, as business students, the research would serve as a
guide in price increment in business.

For the government of Ghana and other government, the result

would serve as a precedent and a guide.

DELIMITATION
We would be restricting the research to just the effect of the price
increment on the prices of transportation and food. We also would
be limiting the research to questionnaires and personal
observations.
We also would not concern ourselves with the macro-economic
effect on output.

RESEARCH METHODOLOGY
We would be making use of both primary and secondary data.
For the resultant price increase, we would be making use of
surveys, observation and market inspection of prices.
For the comparison and analysis, we would be making use of
historical data of the effect of the individual items (electricity, gas
and water) on the prices of transportation and food.