Question
The diagram below shows the demand for and supply of petrol. The market is initially in equilibrium at point x . There is then a
The diagram below shows the demand for and supply of petrol. The market is initially in equilibrium at pointx.
There is then a shift in the demand and/or supply curves, with a resulting change in equilibrium price and quantity.
To which equilibrium point (a, b, c, d, e, f, g or h) will the market move from point x after each of the following changes?
The market for petrol
(a)A rise in the cost of refining petrol.
(b)A fall in bus and train fares.
(c)A fall in the price of crude oil and an increase in the price of cars.
(d)A rise in tax on petrol and a reduction in tax on cars.
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