Which of the Following Is the Best Explanation for Why

question 36

Multiple Choice

Which of the following is the best explanation for why the price of gasoline increases during the summer months?

• A) Oil producers have higher costs of production in the summer.
• B) Sellers have to earn profits during the summer to cover losses in the winter.
• C) There is increased driving by families going on vacation.
• D) There is less competition among oil refineries in the summer.
• E) The number of gas stations open 24 hours a day rises in the summer months and so the price must rise to cover the higher costs.

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Definitions:

Import Substitution

A strategy aimed at reducing foreign dependency through the domestic production of previously imported goods.

Infant Industries

Newly established industries that may not yet be competitive in the global market without protection or support from the government.

Global Rivals

Competitors that operate in multiple countries around the world, often vying for market share in the same industry sectors.

Infant Industry

A newly established sector or industry in its early development stage, often protected by the government through tariffs or subsidies to help it grow.