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Discuss the current low price of gas

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Question: Demand for cars (as opposed to SUVs, Crossovers, and Trucks) is currently very low. This is caused in large part by the current low price of gas. Assume you drive 40 miles round trip each day to work. Also assume that you currently drive an older small car that enjoys 30/mpg. Your old car needs to be replaced and you can now afford a new and nicer car. You prefer a bigger vehicle that sits higher. Would you buy a bigger SUV/Crossover/Truck that averages 23/mpg or a car that averages 36/mpg? Explain how your decision is impacted by your estimates of what will happen to the factors that will affect gas prices in the future. Do not discuss consideration outside of gas price considerations.

Reference no: EM131580952

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