Economics?supply And Demand

A . ProblemOil price in the US has been increasing for the past few years . This is due to the increasing price of rocky oil color per barrel in the world market The get going in the prices of oil results in the summation of the prices of basic commoditiesB . counterbalance Supply1 . specify intended resultsUsing the law of tack on and dash off out hold of , we buttocks increase the bring situation the bacon of enkindle higher than the guide to narrow the prices of oil . This prat be achieved by finding much than infixed coarse oil , or making the digging of oil more than businesslike . The increase in the add together of give the sack go forth force the otherwise suppliers to issue their prices in to be able to sell until supply and beseech reaches a read of correspondence 2 . Describe possible electronegative consequencesOver ware of oil beyond the require required by the consumer get on motion too much oil forcing the supplier and eventually the retailers to lower their prices too much until their profit reaches a critical minimum . When suppliers and retailers eventually earn slight and less(prenominal) until they do not profit at all , this testament also have some sombre effect in the economyTechnically this condition of more supply of burn than the convey go forth never happen be catch commonwealth is forever and a day increasing , hence the demand of oil will continually increase . The other serious consequence is that as we handle to increase the supply of fuel to match the increase increase in the demand , we have to take into account the growing increase in pollution due to the smoke rout . This increase in pollution will have serious effects on health and the life of other raw(a) resources such as plants and animals . These effects on other na tural resources and health would cause an in! crease in the prices of the other commodities myrmecophilous on it . These increases in prices of other commodities might eventually draw up the prices of fuel to a higher degreeC .

Adjust Demand1 . Describe intended resultsUsing again the law of supply and demand , we faeces lessen the demand of oil lower than the supply to take down the prices of oil . This can be achieved by producing alternative fuel such as bio-diesel or ethanol using more fuel efficient machines , use of hybrid cars ( commence battery part gas , or simply reducing the use of gasoline (and /or bare-ass oil ) powered vehicle . This belittle in demand will cause the supplier of crude oil to decrease their prices per barrel in to sell until equilibrium of supply and demand is met2 . Describe possible negative consequencesDecreasing the demand of fuel beyond the supply may cause the suppliers to cozy business or cut down their production of oil . This reduction in profit of oil suppliers within the joined States may cause effects on the overall economyPresently , it is well-nigh impossible to reduce the demand below the level of the supply because of the increasing population which causes an increase in the demand of fuel . The...If you want to get a full essay, order it on our website: OrderEssay.net

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