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DIPLOMA IN ACCOUNTING
BE 4013
PRINCIPLES OF MICROECONOMICS
ASSIGNMENT
Contents
Introduction........................................................................................................................................... 3 Prices of Related Goods......................................................................................................................... 5 Complementary Goods...................................................................................................................... 5 Gasoline............................................................................................................................................. 5 Parking Spaces and Fees Related to it................................................................................................ 7 Driver’s Licenses.............................................................................................................................. 10 Toll Fees........................................................................................................................................... 13 Substitute Goods................................................................................................................................. 14 Bicycle.............................................................................................................................................. 14 Public Transportation...................................................................................................................... 18 Public transportation brings lots of convenience to the commonwealth. Types of public transport in Japan are buses, trains, and commuter....................................................................................... 18 Subways....................................................................................................................................... 18
- Tram pass..................................................................................................................................... - Bus...............................................................................................................................................
- Punctuality of Trains and Commuter...................................................................................................
- Car sharing in Japan.............................................................................................................................
- The policy of the government..............................................................................................................
- Vehicle Inspection............................................................................................................................
- Expectations about Future Supplies of Local Cars...............................................................................
- Tastes and preferences........................................................................................................................
- Reliability and Services........................................................................................................................
- Composition of population..................................................................................................................
- Wages and income of Japanese...........................................................................................................
- Cost of living in Japan..........................................................................................................................
- Challenges...........................................................................................................................................
- Conclusion...........................................................................................................................................
- Bibliography.........................................................................................................................................
Through these in-depth studies, we aspire to help internal seniors managers, like Chief Executive Officer to comprehend the current scenario in Japan, then coordinate with sales, marketing, finance, and operations departments to achieve the goal of Sam Motors Bhd. Other than that, this report aimed to prepare the senior managers to plan for the best, ensuring operational strategies can be well-developed; goods and services appropriately to consumer demand could be distributed and supplied. The several factors that are affecting the demands of cars include: Price of related goods -Complementary Goods Gasoline Parking spaces and Fees Related to it Driving License Toll Fee
- Substitute Goods Bicycle Public transportation Punctuality of Trains and Commuter Car Sharing in Japan The policy of Government Vehicle Inspections Car Tax Expectations about Future Supplies of Local Cars Tastes and Preferences Reliability and Services
Composition of populations Wages and income of Japanese Cost of living in Japan Prices of Related Goods Complementary Goods Complementary goods are often referred to goods that are used in conjunction with other goods or services. The relationship between the price of complementary goods and the demands of goods is said to have an inverse relationship (Sehlhorst, 2007). For example, printers and ink, socks and shoes, computer and keyboards, and obviously, the complementary goods for cars are gasoline, parking fees, cost of obtaining a driving license, and fees for car insurance. Gasoline Using the gasoline price on 1st April as a reference, the statistics present that the price is 141.0 JPY (approximately RM 5.25) per liter, while in other Asia countries, for instance, Myanmar 900 Kyat (approximately RM2.45), and Malaysia RM 2.08 per liter. The average price of gasoline in the world for this period is 169.20 JPY (Approximately RM 6.25). We can conclude that the gasoline price in Japan is relatively expensive, in comparison to other countries. (GlobalPetrolPrices.com, 2019)
This line chart shows that the price of regular gasoline in Japan has been gradually increased from 2017 to 2018, it is expected that by 2019, the price of gasoline will continue to rise. While the price of gasoline increases demand gasoline will eventually decrease, so the demand for cars will most likely to face decrement. Parking Spaces and Fees Related to it Geographically, Japan has a small country with limited land. Due to that, parking fees are proportionately expensive. According to Yoshio Yamamura of the Japan Parking Business Association, the fare rate is varies based on daytime (8 a.m.-8 p.m.) and nighttime (8 p.m.-8 a.m.) and location. Drivers are usually charged at 100 JPY for every 10, 15 or 30 minutes. In certain locations, the parking rate is 3000 yen (approximately RM 109.83) for a 24 hour period, (Vidal, 2016). However, in urban areas, the fare often goes up to over 1,000 JPY per hour! (Takiguchi, 2018) Imagine parking during work hours …… It may be equivalent to wages per day! Yet, parking lots are immensely finite; it may take up to hours just to find a spot to park. This may lead to a reduction in productivity. Since Japanese are often described as “obsessed with punctuality”, (Demetriou, 2018) having a car in Japan might not be as convenient as expected. In Japan, parking space is not always available. Even more surprisingly, parking spaces are not prepared in every residential area like any other country. In other countries, usually for owners of landed properties, they can park wherever they want within their premises, or the road space in front of their premises. Meanwhile, parking at home is a different story in Japan.
While motorists are buying a car, Japanese law requires them to prove they have access to a local parking space. They are required to obtain a "parking certificate", called as Shako shomei sho" by registering the car with local police. Proof of owning a parking space must be submitted, it is known as shako shōme. If consumers own a house with a parking space attached to it, it is essential for them to provide a diagram of the space to the police as well (PHILIP BRASOR AND MASAKO TSUBUKU, 2017). The process will be even more complex if they rent their house. Drivers must have the owner of the property they lease to fill out a form beforehand. In addition, the parking space must not be more than 150 meters from their residential area. Motorists are also required to report to the local police if they are moving. They should update their new address and their new proof of parking. (PHILIP BRASOR AND MASAKO TSUBUKU, 2017) Cost of Application for Parking Certificate Description Cost (JPY) Cost (RM) Parking Certification Application 2,100 79. Parking Badge 500 18. Re-issue of Parking Certification 400 15. Re-issue of Parking Badge 500 18. The table above shows the additional costs need to pay by motorists in order to obtain a parking certificate for their vehicles. (Drive in Japan, n.d.).
Diagram (3) The Real Estate Economic Institute reports that as many as 14,730 brand new apartments were offered for sale across greater in the first half of 2017, but only 6,218 car parking spaces were provided in these new buildings, this indicates a ratio of 42.2% only. (Japan Property Central, 2017) The lowest ratio was 56.0%, with 2,064 parking spaces for 7,008 new apartments in Tokyo’s 23 wards. On the contrary, the highest ratio was won by Chiba Prefecture with a ratio of 61.9%. Overall the number of parking spaces offered by developers had ceased to decrease and this discourages the demands of cars. Driver’s Licenses Cost In Japan, the cost of getting a driver's license is more expensive than the cost of owning an automobile. The entire process of getting driver's license will probably cost around 200,
to 300,000 yen which is around RM 7420.46 to RM 11130.69 in Malaysian Ringgit. The cost of a driver’s license inclusive of transport fees to the place for driving lesson which cost around 500 to 980 yen ( approximately RM 18.55 to RM 36.36 ) for 1 lesson per trip, the 50 minutes of driving lesson which costs 6156 to 7200 yen ( approximately RM 228.40 to RM 267.13 ) included tax, (Cruise, 2019) registration fees for the driving lesson place which costs 3500 to 3600 yen (approximately RM 129.85 to RM 133.56), (Cruise, 2019) the fees for the provisional written exam which cost 3100 yen per attempts ( approximately RM 115.01 ) while the fees for the provisional practical exam would be 1650 yen ( approximately RM 61.22 ) for the first attempt and 4750 yen ( approximately RM 176.23 ) for an extra attempt, (Gakuran, 2012) printing of provisional license which cost 1200 yen ( approximately RM 44.52 ), the fee for the final written exam which cost 2400 yen ( approximately RM 89.04 ) and the fee for the final practical exam which cost 1000 yen ( approximately RM 37.10 ) for the first attempt and 3400 yen ( approximately RM 126.14 ) per extra attempt. After passing: 4 hour of classroom and practical training fee which cost 9800 yen ( approximately RM 363.59 ), 3 hour of first aid training which cost 3600 yen ( approximately RM 133.56 ), printing of full license which cost around 2050 to 2100 yen ( approximately RM 76.06 to RM 77.91), (Cruise, 2019) license photo which cost 600 yen ( approximately RM 22.26 ), test application for retake 2550 to 3350 yen ( approximately RM 94.61 to RM 124.29 ). (Gakuran,
In Japan, obtaining a driving license is not easy. The driving test conducted by Japan was internationally recognized as one of the most difficult driving tests in the world. In average, students take 15 attempts to pass their test. (2018)
Toll Fees The factor that lower down the demands of the car in Japan are the toll fees. There are a few types of available expressway passes and each charge differently. The most expensive toll fee is Japan Expressway Pass, the is price is 20,000 JPY for only 7 days and 34,000 JPY for 14 days, but Hokkaido, Metropolitan Tokyo, Metropolitan Osaka and on the bridges between Honshu and Shikoku are not in the coverage area. Besides that, it's the Hokkaido Expressway Pass, drivers are charged 3,600 JPY for 2 days, and 11,300 JPY (14 days) but the only coverage area is in Hokkaido. Apart from that, the Tohoku Expressway near to Sapporo and it’s the only lane to Sapporo is priced at 4,000 JPY for 2 days and 12,000 JPY for 14 days. Other than that, Central Nippon Expressway pass Have Coverage Central Japan between Tokyo and Kyoto, including Ise, Shirakawago, Toyama, and Kanazawa, except some expressways around central Nagoya because it near to outskirt and the location population is low. The price is from 5000 yen to 16000 yen. Furthermore, Sanin-Setouchi-Shikoku Expressway Pass the price is from 6,000 yen (3 days) to 13,000 yen (10 days) the coverage area are Western Honshu and Shikoku. Last but not least, Kyushu Expressway Pass the price is from 3,500 yen (2 days) to 11, yen (10 days). (Stefan Schauwecker, 1962) The following table shows the price of toll fares from Tokyo, Aomori, Nagoya, Osaka, Hiroshima, and Fukuoka to a different area.
Kagoshima Fukuoka Hiroshima Osaka Kyoto Nagaya Aomori Tokyo 27500 34000 17000 12000 10500 8000 14000 Aomri 39000 16000 28500 23000 22000 20500 Nagoya 21000 13500 10500 3500 3500 Osaka 18500 13000 8000 2000 Hiroshima 11500 6500 7500 Fukuoka 6000 When the toll fees are high, consumers prefer to take trains and public transport, the demands of cars will decrease. Substitute Goods Substitute goods are often referred to as goods that serve the same purposes. When the price of the substitute goods is relatively low, consumers tend to purchase the product at a lower price, thus this causes the demands of initial goods to decrease. Thus, substitute goods and original goods have a negative relationship. Three major substitute goods used by the Japanese are the bicycle, buses, and subways. Bicycle Since the price of gas and parking fees for a car is increasing, this causes a lot of citizens in Japan to cycle compared with buying a car. Plus, it is very inexpensive and dependable, these workhorses are common sights in Japan‘s urban landscape.
assistance are gradually becoming more and more popular nowadays. Foldable bicycles, mountain bikes, and road racing bicycles are rarely available for rent and on the streets are vastly outnumbered by the inexpensive Mamachari. The history of Mamachari has been around for longer than a half century, first appearing Mamachari in Japan is in the 1950s. The Mamachari made bicycles accessible to people of all ages and gender. Over the decades, they have become an indispensable facet of everyday life. Starting from less than 10,000 JPY (RM 379.80) for today, they are more affordable compared with cars, hence, the demands of cars will most likely to fall.
Diagram (6) shows an example of the Mamachari.
Tram pass The one-day pass for Tokyo cost 750 yen which is RM28.59 while the 24-hour pass for private subway cost 600 yen which is RM22.87. This one-day pass and also 24-hour pass can be used in all Japan Rail trams, subways and also buses. In Kyoto, the first or second-day vouchers can be used by tram and also a bus at price of 1200 yen and 2000 yen respectively which is RM45.74 and RM76.23 it also includes some discounts for people’s attraction. (2017) If you purchase the Kansai Railway Pass, you will need to pay for an average daily cost
which is around 1600 to 2200 yen which is RM60.99 to RM83.59 from 1 day to 5 days.
(2017) Bus Regardless of Tokyo or Osaka, Kyoto, and Hokkaido, the average bus fare in Japan will be around 210 to 250 yen which is RM8 to RM9.53. If you take 4 and a half hours for long-distance bus routes across the country such as go to the mountain like Kyoto will cost about 4800 yen which is RM182.96. (2017) The general cost will depend on the length of the distance u take. (2017) As a conclusion, no matter if Japanese travel in long distance or short distance, traveling by public transportation is more convenient. The cost of public transport is low, the demands of cars will be low. (2017)
Punctuality of Trains and Commuter Due to cultural influences, the Japanese are obsessed with punctuality. In Japan, driving a car to work or school might lead to delay due to congested parking spaces and traffic jams. Congested parking occurred because of high demands and low supply of parking spaces. The figure below shows the percentage of congested or fully-occupied parking spaces on the weekday by zone and by the time of the day. The highest congestion rate is on 1300 with Setagaya placed first, followed by Ginza, and Tokyo. The highest congestion percentage is 38.2 % at that 1300. (So Morikawa, Kohei Asao, Takahiro Igo, Hironori Kato) (So Morikawa, Kohei Asao, Takahiro Igo, Hironori Kato) Reportedly, chronic congestion in Tokyo alone cost the economy an estimated 10 trillion JPY (RM 380 000 000) a year, which is a huge loss since no productivity takes place during the jam! (Hays, 2009)
