No Free Lunch: Economics for a Fallen World: Third Edition, Revised

Chapter Three: Demand 80 11. What is the definition of elasticity? Why is this term important to understand demand? 12. Will the following tend to make the demand curve for gasoline more inelastic or more elastic? a. As time progresses from the short run to the long run (say 5 years later). b. A new form of alternative fuel becomes viable and is cost competitive with gasoline. c. The economy goes further down and you lose your job and have to live off savings.