Suppose that market price of gas increases from $2 to $3 per gallon and quantity demanded for this good falls from 24 to 18 gallons per week. Calculate price elasticity of demand and interpret the result.
Suppose that weekly income of a household decreases from $1,200 to $1,000 and quantity demanded for gas falls from 18 to 14 gallons per week. Calculate income elasticity of demand and interpret the result.
Suppose that market price of diesel fuel falls from $5 to $3 per gallon and afterwards weekly quantity demanded for gas decreases from 18 to 16 gallons per week. Calculate cross-price elasticity of demand for gas and interpret the result.
Suppose that market price of gas increases from $4 to $5 per gallon and quantity supplied for this good increases from 13 to 17 gallons per single car weekly. Calculate price elasticity of supply and interpret the result.