Refer to the information provided in Figure 20.5 below to answer the question(s) that follow. Figure 20.5
-Refer to Figure 20.5. The domestic price of oil is $130 per barrel. If the world price of oil is $120 per barrel, this country will
A) import 19 million barrels.
B) import 14 million barrels.
C) export 5 million barrels.
D) export 19 million barrels.

Question

Refer to the information provided in Figure 20.5 below to answer the question(s) that follow.  Figure 20.5
-Refer to Figure 20.5. The domestic price of oil is $130 per barrel. If the world price of oil is $120 per barrel, this country will
A) import 19 million barrels. 
B) import 14 million barrels. 
C) export 5 million barrels. 
D) export 19 million barrels.

Quizplus · Accepted Answer

When the world price is lower than the domestic price, the country will import oil to meet its demand at a cheaper rate. The difference between the domestic demand and domestic supply at the world price indicates the quantity imported, which is 14 million barrels.

Refer to the Information Provided in Figure 20