After Iraq invaded Kuwait, gasoline prices rose dramatically-up to 50 percent. There were many effects of the increased price of gasoline Explain the following effects in terms of income effect, or the substitution effect, or both effects: a. People drove less and purchased less gas. b. People ate out less often. c. People had more tune-ups done on their cars. d. Bike sales went up. e. The sale of lottery tickets fell. f. People took vacations closer to home.

Question

After Iraq invaded Kuwait, gasoline prices rose dramatically-up to 50 percent. There were many effects of the increased price of gasoline> Explain the following effects in terms of income effect, or the substitution effect, or both effects: a. People drove less and purchased less gas. b. People ate out less often. c. People had more tune-ups done on their cars. d. Bike sales went up. e. The sale of lottery tickets fell. f. People took vacations closer to home.

Trevor · Answer

DAMON is Working on it for you so stop posting it!

jean · Answer

Sorry, I thought I posted it undr the incorrect subject. Thank you

Damon · Answer

I just finished the one maximizing utility of wine and cheese. I am way behind on the physics.

Damon · Answer

Jean - you can figure this one out just as easily as I can. not eating out for example is clearly income decrease effect as is lottery budgets bike purchases is mostly substitution

jean · Answer

Thank you Damon for all your help this evening.