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You operate a delivery service in your local area, but you are thinking of expanding to another market.  You’re concerned that you might need to set different prices in the new market because the cost of gas might be much different. 

Identify 10 gas stations in your local area.

Record the price per gallon for each gas station.

Research supply and demand curves for gasoline.

Create an Excel® spreadsheet in which you do the following:

  • Create a supply curve for gasoline.
  • Create a demand curve for gasoline.
  • Calculate the average cost of gas in your local area.
  • Calculate the standard deviation.

Determine whether the prices in your local area are higher or lower than the national average.

Create a 700-word proposal in which you include the following:

  • Explain elasticity of supply and demand and how this relates to your pricing decision.
  • Determine if your prices will be higher, lower, or the same for the new location.
  • Defend the pricing decision including all supporting documentation.

Cite a minimum of two scholarly references not including your text.

 

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