Why Do Most Economists Believe We Will Not Run Out

question 177

Multiple Choice

Why do most economists believe we will not run out of oil?

• A) The government has wisely subsidized alternative forms of energy.
• B) If oil was in short supply, its price would rise, causing consumers to conserve on its use and producers to discover more oil and alternative energy sources.
• C) Government imposed regulations that force automobile manufacturers to produce cars that use less gasoline per mile.
• D) This is a trick question. Most economists believe that the world will run out of oil in about 20 years.

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Definitions:

Excess Demand

A situation where the quantity demanded of a good or service exceeds the quantity supplied at the current price.

Shortage

A situation in a market where the demand for a product exceeds the supply, resulting in a lack of enough goods to satisfy consumer demand.

Surplus

Occurs when the quantity of a good or service supplied exceeds the quantity demanded, often resulting in a decrease in price.

Sellers

Individuals or entities that provide goods or services in exchange for payment, playing a critical role in the dynamics of supply and market operations.