The price elasticity of gasoline in the U.S. is 0.4. If the price of gasoline rises...
Homework Answers
Price elasticity = % change in the quantity of gasoline supplied / % change in the price of gasoline
0.4 = % change in the quantity of gasoline supplied / 8%
% change in the quantity of gasoline supplied = 0.4 * 8% = 3.2%
Thus, the expected change in the quantity of gasoline supplied in the U.S. is 3.2%
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price elasticity of gasoline in the U.S. is 0.4. If the price of
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