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2. In January 2016, the US removed the export ban. So, now assume the US allows...

2. In January 2016, the US removed the export ban. So, now assume the US allows oil exports. Addi- tionally, assume that US exports of oil do not affect the world price of oil (i.e. the US is a small exporter of oil).

(a) Using an appropriate diagram, illustrate the US market for oil after removal of the ban.

(b) Show how Consumer Surplus (CS), Producer Surplus (PS) and US welfare have changed because of the export ban removal.

(c) Which groups in the US economy would support removal of the export ban and which groups would oppose its removal?

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