John s demand schedule for pizza is indicated below. Using the graphs below, answer the following question. To achieve maximum satisfaction consumer equilibrium consumers have to allocate income in such a way that the ratio of the marginal utility to the price of the goods is equal for all goods purchased. In the long run all inputs are variable. For a roadside fruit seller, the long run might be very short, perhaps a day or a few hours.
Gasoline is least elastic, since there are few substitutes for it in the operation of cars.
Shell gas at a particular station is most elastic, since one can substitute other Shell stations or other brands of gas. Op cost increases. Question 6 page 215. Answer page 426.