Exhibit 3-5 -Refer to Exhibit 3-5.Suppose That a War in the Middle

Exhibit 3-5
-Refer to Exhibit 3-5.Suppose that a war in the Middle East causes the quantity supplied of oil to fall by 175 million barrels per day at every price.
(A)Chart the new supply schedule.
(B)What is the new equilibrium price and new equilibrium quantity?
(C)Given this shift in supply,is there a shortage or surplus at the old equilibrium price? Explain the mechanism that adjusts the market to the new equilibrium.