Lately there has been talk about discontinuing the penny due to rising costs of the metals used to produce it; making the production of the penny more expensive than the value of the coin itself. On top of that, society today does not seem to care very much about the penny. Vending machines do not accept them, they can be found everywhere on the ground, and it is not even worth saving them when you need one hundred pennies just to equal one dollar. But if we do leave pennies behind, what will happen to prices? Would goods priced at $2.99 be rounded up or down? Even a bigger concern would be how taxes would change. If taxes are not changed, then if something priced at $2.95 has an 8% tax, it would add an additional $0.24 to the total, making the final price $3.19 which requires pennies to be used at some point in the transaction. The only way to fix that problem would be to either change the percent tax to 0.05% or to 0.10% to keep the final price even. So are pennies just weighing down our pockets and purses, and should we get rid of them? Or would it be too much work and we should just continue to print them despite the fact that it costs more than a cent to make a penny?

Advertisement