Write a 1 page essay on The positive analysis of how sensitive consumers are to changes in gas price.
This would then mean that homeowners would prefer to own homes that are closer to their workplaces or urban centers to facilitate shorter driving distances. The shopping habit of the consumer would have to change I.e. less trips to shopping malls and more shopping on the internet. Moreover, there would be considerable decrease in the amounts of goodies bought at the supermarket. There would also be a shift from shopping at supermarkets to lower priced stores.
The shift in gas prices would affect the decision of what type of car the individual can purchase. This is because different cars have varying rates at which they consume gas. Therefore, the consumers will go for those that consume less per mile covered. Some consumers will most likely choose the cheaper modes of public transport for commuting purposes as compared to driving. It would be accompanied by the use of alternative modes of transportation for instance bicycles etc.
Consumers are likely to invest less and save considerably lower amounts of money as compared to when the gas prices were lower. Utilization of amenities like telephones, electricity is likely to go down also (Sobel, 2013). Essentially changes in gas prices cause proportionate change in the lifestyles of the