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Draw a supply and demand graph to show how the destruction of the storage terminal in Richmond would affect the equilibrium price and quantity of gasoline in Richmond.

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Questions

  1. Draw a supply and demand graph to show how the destruction of the storage terminal in Richmond would affect the equilibrium price and quantity of gasoline in Richmond.

  2. What happens to the equilibrium price of gasoline in Richmond?

    1. Price increases

    2. Price decreases

    3. Price remains constant

    4. The effect on price is indeterminate; price may rise, fall, or remain the same.

  3. What happens to the equilibrium quantity of gasoline in Richmond?

    1. Quantity increases

    2. Quantity decreases

    3. Quantity remains constant

    4. The effect on quantity is indeterminate; quantity may rise, fall, or remain the same.

  4. Would drivers in Richmond eliminate more unnecessary trips?

    1. Yes

    2. No

Explain why or why not.

  1. Would drivers in Richmond who own two cars use more more fuel-efficient cars more frequently instead of gas guzzlers?

    1. Yes

    2. No

Explain why or why not.

  1. Would truckers from Roanoke, Maryland, or North Carolina divert to Richmond some of the gasoline they normally distribute locally?

    1. Yes

    2. No

Explain why or why not.

  1. Draw a supply and demand graph to show how your answer to question 8 would affect the equilibrium price and quantity of gasoline in Roanoke, Maryland, or North Carolina.

  2. What happens to the equilibrium price of gasoline in Roanoke, Maryland, or North Carolina?

    1. Price increases

    2. Price decreases

    3. Price remains constant

    4. The effect on price is indeterminate; price may rise, fall, or remain the same.

  3. What happens to the equilibrium quantity of gasoline in Roanoke, Maryland, or North Carolina?

    1. Quantity increases

    2. Quantity decreases

    3. Quantity remains constant

    4. The effect on quantity is indeterminate; quantity may rise, fall, or remain the same.

  4. Would drivers in Roanoke, Maryland, or North Carolina reduce their consumption of gasoline?

    1. Yes

    2. No