Carmen Sanchez is a sales representative for Sherwin Williams and her territory includes approximately 120-mile radius of her "home" retail store. Her customers are painting contractors and facility managers of office complexes, apartment buildings, hospitals, and other businesses that might have commercial painting needs. Carmen uses her company vehicle and spends about five hours each day in her car visiting her customers and prospecting for new business. Since her territory is so large, Carmen puts about 200 miles on her car each day, which consumes a lot of gasoline. She tries to be economical when choosing gas stations, but it doesn't really matter how much the gas costs, she pays the price. In this case, demand for gasoline is _________.
A) inelastic
B) elastic
C) unitary
D) variable
E) fixed

Question

Quizplus · Accepted Answer

Carmen's demand for gasoline can be considered inelastic because she needs to use her car to visit customers and maintain her business, regardless of the price of gasoline. Even if the price of gas increases, she will still need to purchase it to fulfill her job responsibilities. Her demand for gasoline is not highly responsive to changes in price, making it inelastic.

Carmen Sanchez Is a Sales Representative for Sherwin Williams and Her