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    Application of Theories/Assumptions

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    - Find an example of a recent major decision (whether in business, politics, etc.) that was made based on assumptions that turned out to be incorrect.

    - Explain why at least 2 assumptions for this decision were incorrect, and explain what led to their use as a basis for the decision.

    - What would you have done to test the validity of the assumptions? What specific kinds of research, testing, or surveying might you have performed if you were the decision maker in a similar situation in the future? What, if anything, would you do differently about the assumptions being made?

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    Find an example of a recent major decision (whether in business, politics, etc.) that was made based on assumptions that turned out to be incorrect.

    A major decision that was made by the government in one of countries in Asia is the imposition of the Expanded Value Added Tax (EVAT). Actually, this was a decision made, which up to now, is having a lot of adverse effects on the various sectors in the economy - from the producers, suppliers of resources, the consumers, and the households.

    Expanded Value-Added Tax (EVAT) is a value added tax that has a wider scope. This law extends the tax base to include the fuel, electricity, and transport industry. It simply means an increase in tax, that is being paid by the people. This is where the government gets the fund for its programs for the country. Comparing EVAT with the old one, EVAT increased the tax at a rate of 12% unlike the VAT which is only 10%.

    To give a background about taxation, it is actually one of the tools that should have been utilized by the government to combat inflationary rate. It is under fiscal policy, the twin or the supplement to monetary policy. While the monetary policy intends to lessen inflationary rate by increasing the money supply, fiscal policy (in which taxation is one of the tools) is also a solution (supposedly) to reduce inflation rate by an increase in government expenditures that is facilitated by the imposition of ...

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