We predict the long-run price elasticity of demand of gasoline would be Larger than the short-run price elasticity of demand of gasoline.
Elasticity:
Elasticity refers the economic concept used to measure the change in the aggregate quantity demanded of a good or service in relation to price movements of that good or service.
Given,
Here we need to find difference between the the long-run price elasticity of demand of gasoline would be and the short-run price elasticity of demand of gasoline.
According to the definition of elasticity, the difference between the the long-run price elasticity of demand of gasoline would be is larger.
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