Problem
The short-run elasticity of demand for gasoline sold at gas stations is 0.20 and elasticity of supply is 1.00. If terrorism reduces supply by 5 percent, and gas were selling for $1.75 before terrorism, what would you predict would happen to the price of gas?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.