a. Referring to the above data, discuss whether gasoline cars and electricity are substitutes or complements. b. Electric cars are more expensive than gasoline cars. Compare the incomes of people who buy electric cars vis-à-vis those who buy gasoline cars. c. Considering the buyers’ incomes, explain why the demand for electric cars is less price elastic than the demand for gasoline cars.
Transport economists Lasse Fridstrøm and Vegard Østli studied the
a. Referring to the above data, discuss whether gasoline cars and electricity are substitutes or complements.
b. Electric cars are more expensive than gasoline cars. Compare the incomes of people who buy electric cars vis-à-vis those who buy gasoline cars.
c. Considering the buyers’ incomes, explain why the demand for electric cars is less
d. Why would the short-run demand for gasoline cars be less elastic with respect to the price of gasoline than the long run demand?
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