If a middle-eastern war reduced the quantity of crude petroleum available for export to Japan and the United States by 40%, and the U.S. government responded by imposing price ceilings on petroleum,
A) more petroleum would be available for Japanese users.
B) the demand for crude petroleum in the U.S. would increase.
C) the demand for natural gas in the U.S. would decline.
D) the price of petroleum would rise even higher in Japan.
E) all of the above would be likely to result.
A
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Monopolies are inefficient because, at the profit-maximizing output level,
A) MC = MR. B) MC does not equal MR. C) MB = MC. D) MB does not equal MC. E) P = ATC.
Economic profits and losses are true market signals because they
A) convey information in an asymmetrical fashion. B) convey information about rewards people should anticipate experiencing by shifting resources from one activity to another. C) convey information to public officials about where to encourage people to invest and what skills people should develop. D) cause people to move into careers in both undesirable and desirable industries with equal ease.