Aplia: Student Question xO Aplia ch. 5 Q.6 YouTub x G time horizon and elasticit

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Aplia: Student Question xO Aplia ch. 5 Q.6 YouTub x G time horizon and elasticit x G If the price of gasoline is x > C D courses.aplia.com/af servlet/quiz?quiz action-takeQuiz&quiz-probGuid-QNAPC0A801010000002ae008e0090000;&ctx;=malkiatsandhul-0077 raded Assignment Read Chapter 5Back to Assignment Roland - Due Sundav 10.18.15 at 11: Attempts:* Average: /1 6. Time horizon and elasticity Aa Aa The time horizon of the demand curve is one determinant of the price elasticity of demand If the price of gasoline is relatively high for a long time, consumers are more likely to buy more fuel-efficient cars or switch to alternatives like public transportation. Therefore, the demand for gasoline is in the long run than in the short rurn elastic more no more nor less less more QNA 3.14 © 2004-2013 Aplia. All rights reserved. © 2013 Cengage Learning except as noted. All rights reserved. Grade lt Now Save & Continue Suggestions Session Timeout 56:40

Explanation / Answer

Here we can see that wen price of gasoline increases, people reduce their consumption of gasoline by either buying fuel efficient cars or switching to public transport. Since gasoline demand is very sensitive to gasoline price, the demand for gasoline is more elastic in the long run than in the short run as they will find permanent substitute of gasoline in the long run.

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