Recall the Application Regarding the Elasticity of Demand for Gasoline

question 6

Multiple Choice

Recall the Application regarding the elasticity of demand for gasoline varying over time to answer the following question(s) .
-According to the Application, the demand for gasoline is

• A) less elastic in the long run because consumers have less opportunity to change their behavior.
• B) more elastic in the long run because consumers have time to respond to changes in price.
• C) inelastic in the long run and in the short run.
• D) elastic in the short run.

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Definitions:

Indifference Curve

A graph showing combinations of two goods that give a consumer equal satisfaction and utility.

Efficient Allocation

The optimal distribution of resources and goods to maximize the net benefit or welfare within an economy.

Allocation Efficient

A distribution of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Mutually Beneficial

A situation or agreement that provides advantages to all parties involved, ensuring that each gains from the interaction.