The focus of this question is on the market for petrol in Australia.

During the month of March 2020, the following two shocks occurred in the market for petrol.

1. Major oil producing countries (most notably Saudi Arabia and Russia) moved to increase their crude oil production. Crude oil is the main input to the production of petrol.
2. Road traffic across Australia fell significantly. This is the result of government's lockdown policies to fight the coronavirus spread.

Required:

1. Considering the two shocks above, determine how the demandandsupplyof petrol would change.Clearly explain why such change(s) would occur. (0.5 + 0.5 = 1 mark)
2. Explain how the demand curve and the supply curve will shift as a result of the shocks above.(0.5 mark)
3. Clearly explain how the equilibrium price and quantity of petrol would change as a result.(0.5 mark)
4. For an average petrol station on Glenferrie Road in Hawthorn, how would its revenue in March change, in comparison with February (when there was no shock)? Clearly explain your answer. (1 mark)

Note: You do not need to show any graph as part of your answer. You are only required to describe the change(s) in demand and supply, and the shifts of the curve(s).