Running head : -Impact of dismiss wrongs on Short-run and Long-runInput expenditure Elasticity AbstractThis analyzes the effect of price elasticity of self-colored with grapheme to the fuel prices . Considering the fuel prices as a vital comment to the transportation activities of a devoted , the impact of the variation (decrease ) in the energy prices on the firm s response is studied . The foresighted run cost structure as well as the short run cost structure of the impacted firm are analyzed to distinguish the price elasticity in the both the casesThe law of choose states that the lower the price of the point of intersection , the greater will be its demand . The most unremarkably apply measure of consumer s sensitivity to price is known as Price Elasticity . The Price elasticity of fuel demand measures the responsiveness of the quantity of fuel consumed to the changes in the fuel s price .
A f every(prenominal) in the real energy prices , all else being the same , may cause an increase in the consumption but the demand for substances like fuel is relatively inelastic and hence may not increase with the get off in prices . The change in cost of the fuel used by the firm will drive down the second-rate costs of production in the short runPrice elasticity of fuel change in fuel demand change in fuel priceFuel is a significant input for a firm that needs transportation activities . The relative inelastic demand for fuel explains that fuel does not...If you want to get a full essay, send it on our website: Ordercustompaper.com
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