RE: The potential of banner ads

From: Alex Chudnovsky <alexc_at_jungle.com>
Date: Wed 09 May 2001 14:29:56 -0500

JOHN GASKILL <jg_at_info-central-usa.com> WROTE:

> Oil companies learned during the gas wars of the
> 1960's that gasoline was actually price elastic,
> that is, when the price is lower, people use more
> of it (the "quantity demanded increases").

Ok, I must admit my Economics course was quite a few \
years ago from now (and I often skipped it in favour of
CS related disciplines), but I am pretty sure that
Gasoline (petrol) is one of the examples of NOT elastic
products. Despite price hikes consumers do not stop
using it. That's why all governments love to tax the
hell out of it -- it guaranteed cashflow.

Businesses however may well behave differently
depending on where energy is in their costs structure.

Regards,

Alex Chudnovsky



Received on Wed May 09 2001 - 14:29:56 CDT