Suppose that the United States allowed its domestic fuel producers to use ethanol made from any source (corn or sugar). What is likely to happen to U.S. production of corn ethanol and U.S. imports of sugar ethanol?

Question

Quizplus · Accepted Answer

Allowing fuel producers to use ethanol made from any source would likely lead to a decrease in U.S. production of corn ethanol, as producers would have the option to use cheaper sugar ethanol instead. At the same time, this policy change would likely increase U.S. imports of sugar ethanol, as foreign producers might be able to offer cheaper prices than domestic corn ethanol producers. Therefore, choice C is the best answer.

Suppose That the United States Allowed Its Domestic Fuel Producers