Crude oil can be refined into home heating oil or gasoline. If very cold weather caused the price of home heating oil to increase then, the

Question

Quizplus · Accepted Answer

An increase in the price of home heating oil would cause a shift in the demand curve for gasoline (as some customers may switch to alternative heating sources, leading to a decrease in demand for home heating oil). This, in turn, can cause an increase in the equilibrium price of gasoline as the demand for gasoline would increase. However, the supply of gasoline would not be impacted by the increase in the price of home heating oil.

Crude Oil Can Be Refined into Home Heating Oil or Gasoline