Economics

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A large increase in gas prices creates a demand for cars with good gas mileage. It takes months for car companys to make these cars. How do you describe this market for cars?

A. Inelastic
B. Static

I said A.Inelastic because, its a short run and the firm cannot easily change its output level. Am I right?

  • Economics -

    yes:
    http://www.businessdictionary.com/definition/inelastic-supply.html

  • Economics -

    I agree.

  • Economics -

    Thank you so much i just wanted to make sure im right before i make my final choice.

  • Economics -

    WRONG. The answer is ELASTIC

  • Economics -

    Nevermind. It is INELASTIC. My bad

  • Economics -

    Static

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