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Summer's here. So are higher gas prices The price of gasoline increased 15 percent in the...

Summer's here. So are higher gas prices
The price of gasoline increased 15 percent in the past three​ weeks, mainly because of refinery shutdowns in the United States. As motorists increase their driving in the coming​ months, the price is predicted to rise further.
CNN Money​, May​ 21, 2009
Explain why the price rose in the past three weeks and why it is expected to rise in the coming months.
When refineries shut​ down, ______ and the price of a gallon of gasoline​ ____.
   
A.
the supply of gasoline​ decreases; rises
B.
the supply of gasoline does not​ change; rises
C.
the demand for gasoline​ decreases; does not change
D.
the demand for gasoline​ increases; rises
E.
the supply of and demand for gasoline​ increase; does not change
When motorists increase their driving in the summer​ months, ______ and the price of a gallon of gasoline​ ____.
   
A.
the supply of gasoline​ increases; does not change
B.
the demand for and supply of gasoline​ increase; does not change
C.
the demand for gasoline does not​ change; rises
D.
the demand for gasoline​ increases; rises
E.
the supply of gasoline​ decreases; rises
Business   Economics   
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Homework Answers

Answer #1

Part A

The shut down of a pipeline of millions of people will lead to a shortage of gasoline in the unites states. It will increase the demand for gasoline and leads to higher prices. So people are expecting a higher price.

Part B

Suppose the refineries are shut down then the supply of gasoline is decreased then the price of a gallon of gasoline rises.

Part C

Suppose the motorist is increased their driving in the summer months, then the demand for gasoline increases, then the gallon of gasoline rises.

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