Question

If the price of gasoline doubled, how would consumption of (a) cars, (b) public transportation and (c) in-theater movies be affected? How quickly would these adjustments be made?

Answer 1

The scenario: Gasoline price is doubled.

Consumption of cars: Running of a car becomes costly, which may not afford by an average consumer, causing consumption to fall drastically.

Consumption of public transportation: Those who have stopped consuming cars like to have public transportation for communication. Average people still become affected, since the fare of public transport should increase as the gasoline price increases. The overall consumption decreases drastically.

Consumption of In-theatre movies: There is an indirect effect, since the increasing gasoline price increases the fare of theatre ticket. People would be reluctant to go to theatre hall, since transportation cost increases as well as the fare of watching movie. The overall consumption decreases drastically.

Adjustments:

Searching for a substitute of gasoline (like solar energy) and implementing the same would be the key of quick adjustment. If such thing happens universally, the gasoline would be in competition and there would be little chance of price rise because of loosing market.