Lower Gasoline Prices Essay

Effect of Lower Gasoline Prices 
 As gasoline prices have dropped, it has allowed Americans to drive more. Americans started to go out to eat more at restaurants, travel, and purchase trucks. When the gasoline prices were high, it did not allow people to drive out much because the cost was too high. It caused people to spend less money on going out, shopping for clothes, buying trucks, and much more. For example, in the article “Lower Gas Prices Yield Uneven Benefits” by Anna Louie Sussman and Eric Morath, it discusses how Kimberly Stephens and her family usually take one road trip but this year they had three trips. Furthermore, when the gasoline prices declined, it was expected for retailer businesses’ sales to increase but they did not. …show more content…
As the gasoline prices lower, it allows people to afford the amount to pump gasoline in trucks. Americans taste and preference has change over the time. According to the article “Jerry Seiner, owner of nine auto dealerships, he is selling pickup trucks as fast as they arrive from the factory, while smaller passenger cars are staying on lots longer”(Anna Louie Sussman and Eric Morath). The demand of trucks has increased because of consumers taste and preference. Furthermore, if an economist calculated the cross-price elasticity between gasoline prices and pick-up trucks, it would be negative. It would imply that gasoline and trucks are complements. In others words, if gasoline price increases, the demand for trucks would decrease and if the gasoline price decreases, then the demand for trucks would increase. The effect of lower gasoline prices on the demand for housing would increase. Lower gasoline prices allow people to have more money to spend. Lower gasoline could lead people to buy a house because they can drive farther location without worrying they are going to waste a lot of money on gas. With gasoline prices being high, it makes people double think of how to spend their money. Gasoline prices have a big impact in the