Phil’s filling station gas station operates on a patch on the highway in a patch where there were no gas stations close by. It e

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9 days ago

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Phil’s filling station gas station operates on a patch on the highway in a patch where there were no gas stations close by. It e

njoyed high profits. After a while, Glen’s gas another gas station opened up close by. The profits for the first gas station are likely to decrease because a. it has to lower prices, since its product is now more price elastic b. It has to lower prices since its product is now more price inelastic c. due to the increased availability of substitutes d. both A&C

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1 answer:

arsen [3.2K] · Answer 1 · 2026-03-29T19:22:15+03:00

Both A and C Explanation: Phil's gas station operated solo on a highway stretch with no nearby competition and enjoyed high profits. However, a new gas station was later established in close proximity, leading to a decline in Phil’s profits. The decrease stemmed from the need to reduce prices to boost demand, as customers started opting for the alternatives available. Thus, both factors would contribute to a profit decline.