Question

The time horizon of the demand curve is one determinant of the price elasticity of demand.If the price of gasoline is relatively high for a long time, consumers are more likely to buy fuel-efficient cars or switch to alternatives like public transportation. Therefore, the demand for gasoline is ―――― elastic in the long run than in the short run.

Answer 1

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Step-by-step explanation:

we know that here Price Elasticity of demand is express as

Price Elasticity of demand = PercentageChange is quantity demanded ÷ PercentageChange in price ...........................1

so that, Demand for gasoline is more elastic in the long run than in the short run because in the long run people can change their preferences and choices.