In 2018, a cold front in Barbados increased both the demand for water heaters and gasolines. The usage of gasoline was 581 tonnes, an increase from 499 tonnes in the previous year. The Petroleum Company of Barbados advised Government officials that demand could outweigh supply and asked companies to increase the supply. They also asked major gasoline users, such as power plants, to reduce demand. i. Illustrate the effect of the cold front on the demand for gasoline using a demand curve diagram over the two years. ii. Assuming the Petroleum Company of Barbados did not issue a directive for an increase in supply and a decrease in demand, explain the problem that would exist in the economy and how would this be corrected over time. iii. Illustrate the effect of major gasoline suppliers increasing supply as well as users reducing their demand. iv. Discuss one factor EACH that you think influence demand and supply for water heaters. Provide examples v. Is demand for gas is price elastic or price inelastic? Explain your reasoning
In 2018, a cold front in Barbados increased both the demand for water heaters and
gasolines. The usage of gasoline was 581 tonnes, an increase from 499 tonnes in the
previous year. The Petroleum Company of Barbados advised Government officials that
demand could outweigh supply and asked companies to increase the supply. They also
asked major gasoline users, such as power plants, to reduce demand.
i. Illustrate the effect of the cold front on the demand for gasoline using a demand
curve diagram over the two years.
ii. Assuming the Petroleum Company of Barbados did not issue a directive for an
increase in supply and a decrease in demand, explain the problem that would exist
in the economy and how would this be corrected over time.
iii. Illustrate the effect of major gasoline suppliers increasing supply as well as users
reducing their demand.
iv. Discuss one factor EACH that you think influence demand and supply for water
heaters. Provide examples
v. Is demand for gas is price elastic or price inelastic? Explain your reasoning
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 2 images
