Recent energy legislation that dictates increased use of ethanol as automobile fuel might ________ overall inflation because corn prices will ________, affecting all downstream industries that use corn as a(n) ________.

Question

Quizplus · Accepted Answer

The use of ethanol, derived from corn, as fuel will likely increase corn prices due to higher demand. This, in turn, affects industries using corn as an input (not as a final good), potentially leading to overall inflation.

Recent Energy Legislation That Dictates Increased Use of Ethanol as Automobile