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Explain the seasonable nature of DTE gas revenues

User Beije
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Final answer:

DTE gas revenues are seasonally affected because the demand for heating rises during colder months. Consumers tend to pay higher bills despite increased costs, leading to a spike in DTE's revenues in winter.

Step-by-step explanation:

The seasonal nature of DTE gas revenues is largely due to changes in weather patterns and their impact on consumption habits. During colder months, especially periods of extreme weather like those experienced in the winter of 2005, the demand for home heating typically increases. Due to the inelastic nature of short-run demand for home heating, consumers are less responsive to price changes and thus may end up paying higher utility bills. People may react to increased costs by reducing consumption in different ways, for instance, by lowering thermostats and wearing warmer clothing indoors. However, due to the essential need for heating, significant increases in revenue for gas companies like DTE are common during winter months, illustrating the seasonable nature of these revenues.

User Macshome
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