Recent energy legislation that dictates increased use of ethanol as automobile fuel might ________ overall inflation because corn prices ________, affecting all downstream industries that use corn ________.
A) decrease; will rise; as a final good
B) increase; will rise; as an input
C) not change; will stay constant; as a final good
D) increase; will rise; as a final good
E) Not enough information is given.

Question

Quizplus · Accepted Answer

Increased ethanol use raises corn demand, increasing prices and affecting industries using corn as an input, potentially raising overall inflation.

Recent Energy Legislation That Dictates Increased Use of Ethanol as Automobile