Examlex

Solved

Using Supply/demand Analysis, Explain Why the Increased Production of Ethanol

question 272

Essay

Using supply/demand analysis, explain why the increased production of ethanol (a gasoline additive made from corn) is raising the price of tortillas (a type of bread made from corn). What effect would this price increase have on people unable to afford this higher price?


Definitions:

Unemployment

The condition of being capable and willing to work, but unable to find employment.

Money Supply

The complete aggregate of monetary assets in an economy at a certain moment.

Natural Rate of Unemployment

The level of unemployment consistent with a stable rate of inflation, determined by the structure and dynamics of the labor market.

Phillips Curve

An economic theory suggesting an inverse relationship between the level of unemployment and the rate of inflation within an economy.

Related Questions