Question

Imagine that gas prices have increased to $5.00 per gallon. What will happen to the supply of fuel- efficient cars in the short run and in the long run? Explain.

Answer 1

Well, when the gas price is increased, people want to use the car that has low usage in gas.
So the demand and supply of fuel-efficient cars in the short run will be increased.
But as the year passes, supply will started to slowly dropping

hope this helps