If the Price of Gasoline in This Country Were Expected

Multiple Choice

If the price of gasoline in this country were expected to rise dueto a permanent increase in the tax on gasoline, which of thefollowing would you expect to happen?

A) The demand for gasoline would become more elastic.(True Answer ) Correct
B) The demand for gasoline would decrease as a result of the higher price.
C) Producers will have less of an incentive to supply gasoline as a result of the higher taxes.
D) The elasticity of demand will not change since gasoline is a necessity good.