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Article analysis

We all know that the price of gasoline is continually moving in an upward direction. But what we really want to know is why this is happening, and what measures are necessary to cease this trend. In this selection, the writer will first consider the utility derived from gasoline. Secondly, we will be given a description of occurrences that changed the demand of gasoline and its market and equilibrium prices, assuming the supply remains the same. Thirdly, the author will describe what has occurred to change the supply of gasoline and its market and equilibrium prices, assuming that demand remains the same. Lastly, the writer will give his opinion on whether he feels gasoline is elastic or inelastic, and what this implies about how consumers respond to changes in the price of gasoline.
Satisfaction of wants and needs obtained by the consumption of goods, is the main focus of utility analysis. The decision to purchase and consume a good is affected by the utility generated from consumption. Utility assumes a very precise meaning, which differs from the everyday use of the term, when used in the analysis of consumer behavior. The term utility means “useful”, in common use. For example, something that would be useful around the house: a “utility” knife. In Sports, one that can perform well in several positions would be considered a “utility” player. By all levels of government in the United States, a variety of taxes and fees are assessed on motor fuels. While these duties often include comparatively small fees that provide revenue for environmental protection and other dedicated funds, the largest portion of the taxes paid by the average consumer is used to build transportation infrastructure and maintain roads, effectively making them road user fees (U.S. Energy Information Administration)(2013). * Varying widely from state to state are

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