4.To reduce imports of foreign oil, it has been proposed that the United States impose a substantial tax on g

Question

To reduce imports of foreign oil, it has been proposed that the United States impose a substantial tax on gasoline. However, it is well known that the short-run elasticity of demand for gasoline is very low. What will happen to the total quantity of gasoline sold if there is an additional gas tax?

Answer 1

I dont know the exact answer to this, but there is an easy way to find out for yourself because for consumers, there is no difference between a tax that raises the cost of gas and a change in the price caused by market forces.

so, you can just look to see what happened to consumption during price shocks over the last few years to answer your questions