If everyone drove a 35 mpg+ car,a nd all the new cars were 35+mpg, thus the demand for gasoline going down. Wouldnt that make the gas prices go up?
Most of the time, companys who sell stuff in large numbers, sell it cheaper. Maybe I’m thinking wrong, but if we cut Gas consumption in HALF, Wouldnt the price Double? and thus leave us exactly where we are now, but only polluting less?
you have it backwards. if you cut SUPPLY of gas in half then the price would go up. If they could only pump half as much out of the ground, then your scenario comes true.
But if you cut DEMAND for gas in half, with supply held constant, price theoretically cuts in half.
my first thought is that your scenario is only true in a local market (or captive), not a global one.
What Joe said…
It’s like what is going on with cars right now. WAY too many stuck on the lots not moving, which in your scenario is the gas not being used due to high mpg cars. Now to get rid of this excess, prices get cut.
thats a really good point, but wouldnt a market that sells less gas, cut production aswell?
Let’s talk about the real issue at hand here…
You were THINKING?!?!?!?!
Based on some of the absolutely retarded posts from this forum lately, Just Karter’s stock his been rising:tup:
gas companies would RAISE prices to make up for the profit loss.
People will still DEMAND gasoline, just not as much of it. Unless there is an equal alternative for gasoline… gas companies can control the price as much as they want.
This is why no one pays you to think.
that is what just karter said, but clearer.
however you are not correct, gas is not a monopoly even though there are cartels, it’s a traded commodity. Trading of futures is really what has been driving the price up and down recently. If people expect less demand in the future price will go down.
In the food industry this question is answered mostly by shelf life. How long can gas sit in an industrial gas tank before it’s less usable? If the shelflife is a decade then I don’t think the price would go down. You don’t need to sell the gas quickly if it’s not expiring, so price wouldn’t as affected.
actually that sounds kind of stupid. haha
Dollars have a shelf life. You don’t let inventory just sit.
gasoline isn’t the most elastic product tho. if people are using 50% less but it’s still a necessity, I don’t believe the price would go down. maybe it would stay static? if people are using less of something because it’s no longer a necessity, that would force the price down as an incentive. but it’s a weird scenario when it’s so inelastic.
also, in general if you have a car that gets better gas mileage… you simply drive more.
I noticed that I dont mind turning around when the women forgets something at home, or making multiple runs around the city instead of just one big swing, because I get such good MPG.
In the hotrod, when the girl would forget something, we could be down the street or just barly around the corner and I’d be like:fu:
but you’re still missing my point… the price of gas is not set by supply and demand… it’s set by human speculation about supply and demand in the future, like many commodities.
definitely true. and when it really starts running out the bell curve is steeeeeeep
If everyone was driving high mpg cars, the human speculation about future supply and demand would still project less demand though. I doubt prices would be cut dramatically, but I don’t see how that could cause gas prices to rise.
Low gas prices are also due to the economy being in the shitter.
Less factories using oil to make widgets, less people driving. Less people spending money period.
Do you ever get tired of being stupid?