The inelasticity of demand for gasoline in the short run
A) makes no theoretical sense.
B) makes sense because there are very few substitutes.
C) makes little sense because there are very few substitutes.
D) is more pronounced in the long run.

Question

Quizplus · Accepted Answer

In the short run, consumers have limited options to switch to alternative modes of transportation or fuel-efficient vehicles, thus making the demand for gasoline relatively inelastic. While there may be substitutes in the long run, in the short run, it's difficult for consumers to adjust their behavior or consumption patterns. Therefore, B is the best choice as it provides a reasonable explanation for the inelasticity of demand for gasoline in the short run.

The Inelasticity of Demand for Gasoline in the Short Run