Demand for gasoline in a competitive market


Question: What effect should each of the following have on the demand for gasoline in a competitive market? State what happens to demand. Explain your reasoning in each case and relate it to a demand determinant.

(a) an increase in the number of cars

(b) the economy moves into a recession

(c) an increase in the price of car insurance, taxes, maintenance

(d) consumer expectations of substantial price increases in gasoline

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Macroeconomics: Demand for gasoline in a competitive market
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