42 Supply and Demand Analysis: an Oil Import Fee

question 163

Multiple Choice

4.2 Supply and Demand Analysis: An Oil Import Fee
Refer to the information provided in Figure 4.4 below to answer the questions that follow. Figure 4.4
-Refer to Figure 4.4. Assume that initially there is free trade. If the United States allowed drilling for more oil in the Gulf of Mexico, it could

• A) reduce U.S. oil imports without a tax.
• B) decrease the demand for domestic oil.
• C) reduce the supply of domestic oil.
• D) increase the domestic price of oil.

---

Definitions:

Open Environment

A space or setting that is accessible and conducive to openness and interaction, often contrasted with closed or restricted environments.

Group Counseling

Using group support to find solutions for lifestyle problems.

Disadvantage

A condition or situation that causes a reduction in effectiveness, efficiency, or benefit.

Individual Responsiveness

The degree to which a person reacts or responds to stimuli or experiences.