Currently in the United States, every American that drives a vehilce, are affected by the ELASTIC DEMAND of gas prices. Cars are the number one source of transportation for Americans and in order to drive, you must pay the price for gasoline. The price of gasoline is elastic becasue, no matter the price consumers are forced to pay the current market price if they want to drive their vehilces.
Also, the price of rubber currently is very expensive, and factories that produce car tires are forced to pay the high price for rubber and then pass on the price to the consumer, which is known as COST-PLUS PRICING. This is a technique that businesses use to pass the burden onto the consumer and avioud their fixed prices to decrease, so they can still make a profit.
No comments:
Post a Comment