The Price Elasticity of Demand for Gasoline in the Short

question 109

Multiple Choice

The price elasticity of demand for gasoline in the short run has been estimated to be 0.1. If a war in the Middle East causes the price of oil (from which gasoline is made) to increase, how will that affect total expenditures on gasoline in the short run, all other things equal?

• A) Quantity demanded will stay the same, but total expenditures will fall.
• B) Quantity demanded will decrease, but total expenditures will rise.
• C) Total expenditures will remain unchanged.
• D) Quantity demanded will not change much, but total expenditures will rise.

---

Definitions:

Single Individual

Refers to one person, often in contexts emphasizing the role or impact of just one member within a larger group or system.

Closed Receivership

A legal process where a court appoints a receiver to manage the affairs of a financially troubled company, with the aim of paying off its debts.

Corporate Governance

The set of rules, practices, and processes used to direct and manage a corporation, aiming to balance the interests of various stakeholders.

Bylaws

The set of rules and regulations that govern the internal management of an organization or corporation.