Suppose that the government of the oil-rich country Saudi Arabia sets gasoline prices at $0.25 per litre when the market price is $1.50.The Saudi government's actions will:

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Setting the gasoline price at $0.25 per litre when the market price is $1.50 will result in a shortage of gasoline even in an oil-rich country like Saudi Arabia. When the government sets a price that is below the equilibrium price of the market, it creates excess demand, which leads to shortages. In this case, the low gasoline prices will create a higher demand for gasoline, which will be difficult to meet due to the low price. Therefore, the government's actions will cause gasoline shortages rather than surpluses.

Suppose That the Government of the Oil-Rich Country Saudi Arabia