Electric cars and the supply and demand of gasoline

U.S. Gasoline Demand Is Likely to Slide
by: Lynn Cook and Alison Sider
Jun 20, 2016
Click here to view the full article on WSJ.com

TOPICS: Supply and Demand

SUMMARY: Electric cars are poised to reduce U.S. gasoline demand by 5% over the next two decades-and could cut it by as much as 20%-according to a new report being released by energy consulting firm Wood Mackenzie.

CLASSROOM APPLICATION: Students can evaluate the effect of adoption rates of electric cars on the demand for gasoline. They can also evaluate the effect of the decrease in the demand for gasoline on the price of gasoline in the short run and in the long run.

QUESTIONS: 
1. (Introductory) What is the effect of the increased adoption rates of electric cars on the demand for gasoline?

2. (Advanced) What is the effect of a change in the demand for gasoline on the price of gasoline in the short run and in the long run?

3. (Advanced) What is the effect of the shift from internal-combustion engines to electric-powered engines on the demand for natural gas?

Reviewed By: James Dearden, Lehigh University