View the step-by-step solution to:

Topic: Is it time for the United States to raise gasolines taxes?

Topic: Is it time for the United States to raise gasolines taxes? (environmental economics)

1.Economists have calculated that a demand elasticity of gasoline of 0.06 percent in 2005. Has the demand elasticity of gasoline changed in the last 13 years? Please take into account the following when answering this question.

1) consumers react differently to temporary price spikes to permanent price spikes.

2) car companies discount big cars when gasoline prices increase.

3) the household budget devoted to gasoline falls as income increases.

2.Fuel efficiency standards and gasoline taxes are not mutually exclusive. How does this statement change your answer to question #1?

Accurate answers please

Top Answer

Here is a detailed explanation... View the full answer

1 comment
  • how do you know that "we know that household budget devoted to gasoline has increased"?
    • slim0106
    • Apr 04, 2018 at 11:46am

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.


Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online