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In September 2014, oil was priced at about $90 a barrel. Assume the market for oil was in equilibrium at this point in time. This September, oil is in the neighborhood of $45 a barrel. Assume this represents a new equilibrium condition in the oil market.
What change in the demand for oil (write INCREASE or DECREASE) would explain the recent decrease in the price of oil? How would you demonstrate this graphically? For the second part of this question you can either explain how you would demonstrate this; or accurately and clearly draw a graph showing the change in demand.
What change in the supply of oil (write INCREASE or DECREASE) would explain the recent decrease in the price of oil? How would you demonstrate this graphically? For the second part of this question you can either explain how you would demonstrate this; or accurately and clearly draw a graph showing the change in supply.
How do you think the equilibrium quantity of oil will be affected by these supply-side and demand-side influences? Why?
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Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. Due to increase in the preference for light beer drinkers, Chris Prangel wants to introduce light beer version in Mountain Man. An analysis into the la..
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