From the Chapter Discussion, Why Did Increased Ethanol Production and Consumption

question 197

Multiple Choice

From the chapter discussion, why did increased ethanol production and consumption in Brazil result in higher sugar prices?

• A) Sugar is the primary ingredient in ethanol production and thus when the demand for ethanol increased the demand for sugar also increased.
• B) Farmers reallocated sugar cane to ethanol production, decreasing the production of sugar, and leading to higher sugar prices.
• C) Brazil's demand for sugar increased.
• D) The sugar crop was attacked by disease, which caused a decrease in sugar production.

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Definitions:

Price Customers

Refers to consumers whose purchasing decisions are primarily influenced by the price of goods or services.

Operate As Cartel

Operate as cartel means when independent businesses collectively agree to control production, market, and prices of a product to monopolize a market.

Industry's Price

The prevailing price level for goods or services within a specific industry, influenced by factors such as supply and demand.

Output

The total amount of goods or services produced by a firm or country within a specific time period.