If the Price of Oil Increases Significantly, Buyers and Sellers

question 239

Multiple Choice

If the price of oil increases significantly, buyers and sellers of gasoline will both expect the price of gasoline to also increase.If sellers of gasoline act on their expectations more than the buyers do, then

• A)the equilibrium price of gasoline will increase, while the equilibrium quantity will decrease.
• B)the equilibrium price of gasoline will increase, while the equilibrium quantity will increase.
• C)the equilibrium price of gasoline will decrease, while the equilibrium quantity will decrease.
• D)the equilibrium price of gasoline will decrease, while the equilibrium quantity will increase.

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Definitions:

Hours Per Day

A measure of time, typically referring to the number of hours allocated or spent on a particular activity within a 24-hour period.

Apiary

A location where beehives are kept for the production of honey.

Apple Orchard

A type of farm where apple trees are cultivated primarily for the production of apples.

Honey

A sweet, viscous food substance produced by bees and some other insects from the nectar of flowers.