Author Question: Assume that the government of a nation prohibits producers from extracting crude oil from some ... (Read 15 times)

laurencescou · **on:** Jun 30, 2018

Assume that the government of a nation prohibits producers from extracting crude oil from some domestic oil fields. Which of the following will be witnessed in the market for crude oil?
a. The domestic and world price of crude oil would remain unaffected.
b. The domestic price of crude oil would increase.
c. Oil import from the world market would decline.
d. The world price of crude oil would increase.

Question 2

Given a perfectly competitive market structure at the profit-maximizing output level, a firm's total fixed cost is 15, total variable cost is 137, marginal revenue is 4, and the quantity demanded is 65 . The total profit earned by the firm is 108.
a. True
b. False
Indicate whether the statement is true or false