Gm545 - Project Part 1

RAUL RIVAS

BUSINESS ECONOMICS

GM545

1) Everyone’s Gasoline Problem.

I recently moved to Houston, Tx. But I’ve been familiar more with gasoline prices in Chicago, and they have significantly increased within the past months. I drive a Toyota Rav4 and the current price of gasoline for the past months have been fluctuating from $3.15 dollars per gallon up to $4.25 dollars per gallon. (Chicagogasprices.com) The farthest you go from the city the cheaper it is, Chicago land area suburbs are always very close to the $3 dollar per gallon mark, if you were to fill up your gas tank at any gas station in Downtown Chicago you will be paying more than $4 dollar per gallon. (www.chicagoprices.com) It’s rare for Chicagoans to see a hike in gas prices in the winter time, it’s usually the summer time when people travel the most but in December of 2012 we saw a big hike in gas prices as well. Very uncharacteristic from this area but since everything has been changing lately with the respect of the financials of our country (fiscal cliff, etc) The gas prices lately have not been stable.

Gas prices fluctuate for many reasons, which include the price for crude oil in the world market, supply and demand for gasoline, local competing gas stations, government regulations, and taxes. Crude oil and natural gas play an essential part in our daily lives, supplying 65 percent of the energy used in the United States. As we consume approximately 25 percent of the world's energy and pays less for fuel than many other countries.  (www.thepriceoffuel.com) 

The demand for gas occurs around summer vacation and major holidays where motorist consume the most gas.  When people drive less and use other means of transportation like, car pools, public transportation, and cyclist, this brings the demand down. The City of Chicago has been involved with huge “green” programs that incentive residents from the city who bike to work or car pool. This programs are very popular amongst youngsters, who...