International Trade $-$ End of Chapter Problem

Over the past five years, the United States has become the world's largest producer of natural gas. But gas producers have struggled to find methods to liquefy natural gas so that it can be exported across the Atlantic. Enter Cheniere Energy, a Houstonbased natural gas company that has developed a natural gas export terminal located on the Sabine Pass leading into the Gulf of Mexico. The terminal will give U$.$S$.$ companies access to markets all over the world.

a$.$ How will the development of a natural gas export terminal affect the market for natural gas in the United States?

b$.$ In the accompanying graph, illustrate the effect of an export terminal on the demand for natural gas in the United States.

Market for Natural Gas for the U$.$S$.$

Quantity