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Over the past three years, the price of gasoline has ranged

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Over the past three years, the price of gasoline has ranged from $1.50 a gallon to $4.20 a gallon.

To what extent, if any, are you able to change your quantity demanded for gasoline as the price goes up and down?

Would the answer be different if the price went to $4.20 and stayed there for several years?

What does the concept of elasticity have to do with this?

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Solution Preview

Over the past three years, the price of gasoline has ranged from $1.50 a gallon to $4.20 a gallon.

To what extent, if any, are you able to change your quantity demanded for gasoline as the price goes up and down?

Would the answer be different if the price went to $4.20 and stayed there for several years?

What does the concept of elasticity have to do with this?

To what extent, if any, are you able to change your quantity demanded for gasoline as the price goes up and down?

You are able to change your ...

Solution Summary

Over the past three years, the price of gasoline has ranged from $1.50 a gallon to $4.20 a gallon.

To what extent, if any, are you able to change your quantity demanded for gasoline as the price goes up and down?

Would the answer be different if the price went to $4.20 and stayed there for several years?

What does the concept of elasticity have to do with this?

$2.19