Question

What would happen to the equilibrium price and quantity of crude oil if Saudi Arabia increased its production of oil? describe and show with supply or demand diagram.

Answer #1

The above graph showing the Equilibrium price and quantity of crude oil in this example is assumed that Demand remains the constant.

Th initial equilibrium for quantity and price level is shown whre Deamdnd and Supply curve intersect at P1 and Q1. Now Supply increased but demand remains the same increasing the supply in the market the price falls P1 to P2and quantity increases Q1 to Q2 at new supply curve S2 interacting demand curve equilibrium achieved.

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where P is the price per barrel of oil and Q the total quantity
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An oil refinery in singapore receives crude oil from Arabia and
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If U.S. Congress imposed an import fee on crude oil, what would
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a) Would the world demand curve for crude oil: Shift to the
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1. There are two oil producers, Saudi Arabia and Iran. The market
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barrels daily, and $35 if the total volume of sales is 13 million
barrels daily. Saudi Arabia has two strategies; either produce 8
million barrels daily or 6 million. Iran has two strategies; either
produce 3 million barrels daily or 5 million. Assume...

Consider the market for butter in
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QD = 12 - 2P
Supply:
Qs = 3P - 3.
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2. Equilibrium quantity _____________
Consumer surplus
___________
4. Producer surplus ___________
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and quantity, consumer surplus and producer surplus in the graph
below. Graphs must be on scale.
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Identify the firm’s quantity supplied, average total cost, and
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Finally, use the market supply and demand diagram to show what
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What do you think would be the effect on the equilibrium price
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legalized in canada? Will the Supply Curve shift, and if so, to
which direction? How about the Demand curve? Will it shift and to
which direction? What will happen to price and quantity
exchanged?

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