Macroeconomics 11th Edition by Michael Parkin

Exercise 5

In January 2010, the price of gasoline was $2.70 a gallon. By spring 2010, the price had increased to $3.00 a gallon. Assume that there were no changes in average income, population, or any other influence on buying plans. Explain how the rise in the price of gasoline would affect
a. The demand for gasoline.
b. The quantity of gasoline demanded.