Business Economics

Business Economics GM545 Chapter 3 - Everyones Gasoline Problem. establish on US Energy Information Administration data, yearbook supplied of US gasoline increases rapidly. In 2008, the United States consumed some 137.80 gazillion gallons (or 3.28 billion drums) of gasoline. 1 Currently the retail gasoline expenditures about $2.83 per gallon after it went up to above $3.00 per gallon consequently dropped down. Mainly is the increasing determine of crude petroleum where price varies within the year from $40 to $86 per barrel. Depend upon the circumstance, barrel fossil oil could change rapidly; gasoline production and catalogue argon the two factors could make big impact on the price variation. Basically, there is huge demand on consume of gasoline in US which source of supplies mainly from the ecesis of the Petroleum Exporting Countries (OPEC) which has continued to produce oil to match US consumers. In 1996, gasoline increased from $2.00 to $3.38 due to the Iraq-Irans war broke out. When Iraq and Irans war occurred, their capacity of producing oil were limited and reduced significantly, therefore a change in the supply determinant had triggered up the oil price of US and worldwide, as consequence, its results the supply curve shifted, increasing the price dramatically. On the demand side, U.S.

is heavily depended on foreign oils. As a result, U.S. gasoline prices changed and varied accordingly to the turmoil of the world situation. When US consumers increase number of buyers, this determent of demand affects the market, making a shift to represent an increase in the demand as well. Could we reduce our oil consuming to push OPEC changes its producing capacity and oil prices relatively? From economys aspect, demand and supply are mutually affected. Therefore, with less consuming of gasoline, US consumers would be satisfactory to force OPEC to reduce its price. But the issue is OPEC deprivations to control the price to maximize its profit. Recently when US consumers cut back its usage... If you want to get a full essay, order it on our website: Ordercustompaper.com

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