Question

Suppose the federal tax on gasoline increased by 5 cents per gallon. Do you think that such an increase, reflected in the price of gasoline, would have a significant impact on gasoline consumption?

Answer 1

Suppose the federal tax on gasoline increased by 5 cents per gallon.

To be very true increase in tax or prices of gasoline the consumption of gasoline will also decrease or will be used limited on and when it is essential. When price of gasoline is low then consumption cannot be decrease by keeping future in mind, if the price of gasoline rises—and the price always rises, eventually—consumers will begin to limit their use. More travelers will carpool. Fewer people will drive large cars or use their boats on the weekends. More drivers will switch to electric vehicles and hybrids. Americans will stop taking unnecessary drives, and families will plan vacations nearer to home. At home gas such as LPG and CNG consumption will also decrease, residents will cook when it is necessary not Use for unnecessary foods.