Question

“America's 20-million-barrel-a-day oil habit costs our economy $1.4 billion a day... Every single hour, we spend $41 million on foreign oil.”

Based on the figures provided in this statement, answer the following questions:

a)   What is per capita annual consumption of oil in the United States?

b)   According to the numbers provided, what percent of oil is imported (foreign)? Is this figure reasonable? (justify your answer)

c)    What is the implied cost of oil per barrel? Per gallon? d)   How does the cost of oil you calculated in part c compare with the average retail cost of gasoline in the United States? What factors might account for the difference? Please explain.

Answer 1