Suppose that public utilities burned oil to generate electricity.If the price of oil increases,we expect a shift to the _____ in the _____ curve for _____ and a _____ price for electricity.
A) right;supply;electricity;lower
B) left;supply;electricity;higher
C) right;demand;oil;higher
D) left;demand;oil;lower

Question

Quizplus · Accepted Answer

An increase in the price of oil will lead to an increase in production costs for public utilities which will result in a decrease in supply for electricity. This would cause a leftward shift in the supply curve for electricity, resulting in a higher price for electricity.

Suppose That Public Utilities Burned Oil to Generate Electricity