Gas is up $0.17 per gallon. Panic or minor issue? Just give up a Starbucks or a Big Mac and you break even!
The gas prices have been going up for weeks and here in Massachusetts we’re now paying an average of 3.35 per gallon.
How high gas prices will climb before we start to change our habits?
When you do the math: drive 12,000 miles per year in a car with 20 Miles Per Gallon (MPG) and the recent 17 cents gas price increase per gallon is equal to $1.96 per week. That’s one less coffee.
But at what gas price would make you change the way you live?
I think it’s going to shock a lot of people and there is no magic life altering number like $4 buck per gallon, said Peter Cohan teaches business strategy at Babson College.
Historically Peter Cohan said we react to the speed of the price increase of gasoline than the actual number on the gasoline station at the pump.
If you go back to 2008, consumers really started changing their behavior after the price of gasoline went up 30 cents with a month, said Peter Cohan.
Experts says gas prices increase very slowly we find it annoying like a constant snow fall but when gas prices spike very quickly in a short amount of time – it catches our attentions.
Has the recent gasoline price spike hit us that hard? Peter Cohan thinks we have a little way to go before we really react.
It’s $3.30. If in the next week or so we gasoline prices go up another 10 or 20 cents a gallon, I think it’s going to shock people into saying ‘I really need to change my habits, said Cohan.
When that happens, more people will use more public transportations such as buses and trains.