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28 Sep 2019
Suppose that the current price of oil is $60 per barrel and the quantity sold is 90 million barrels per day. The current estimates of the price elasticity of supply and demand are PES=1 and PED=-.2 respectively.
What will be the effects on the market price and quantity if the U.S. government suddenly decides to purchase an additional 2 million barrels of oil? Assume that the additional consumption of oil by the government results in a parallel shift of the supply curve to the left by 2 million barrels per day.
Suppose that the current price of oil is $60 per barrel and the quantity sold is 90 million barrels per day. The current estimates of the price elasticity of supply and demand are PES=1 and PED=-.2 respectively.
What will be the effects on the market price and quantity if the U.S. government suddenly decides to purchase an additional 2 million barrels of oil? Assume that the additional consumption of oil by the government results in a parallel shift of the supply curve to the left by 2 million barrels per day.
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Joshua StredderLv10
28 Sep 2019