The demand for gasoline in the short run is D. inelastic because there are no good substitutes for gasoline.
Why is gasoline price inelastic in the short run?
When price of fuel rises, the quantity of fuel demanded falls only slightly in first few months. So in the short run, demand for fuel may be very inelastic. … In the short run, consumers’ response to higher oil prices was modest, as there was very little people could do to reduce consumption of gasoline.
What is the formula of gasoline?
Octane | C8H18 – PubChem.
What is inelastic demand example?
Examples of Inelastic Products
The most common goods with inelastic demand are utilities, prescription drugs, and tobacco products. In general, necessities and medical treatments tend to be inelastic, while luxury goods tend to be the most elastic. Another typical example is salt.
What is demand elasticity?
An elastic demand is one in which the change in quantity demanded due to a change in price is large. An inelastic demand is one in which the change in quantity demanded due to a change in price is small. If the formula creates an absolute value greater than 1, the demand is elastic.