Suppose that the United States allowed its domestic fuel
Producers to use ethanol made from any source (corn or sugar).
What is likely to happen to U.S.production of corn ethanol and
u.S.imports of sugar ethanol?

Question

Quizplus · Accepted Answer

If domestic fuel producers are allowed to use ethanol made from any source, they may switch to the cheaper alternative, which in this case would be sugar ethanol. As a result, the production of corn ethanol is likely to decrease. However, the use of sugar ethanol is likely to increase, leading to an increase in the imports of sugar ethanol from other countries.

Suppose That the United States Allowed Its Domestic Fuel