One reason the U.S. government might subsidize research of an alternative to crude-oil based gasoline is that
A) more substitutes will reduce the price of crude-oil based gasoline.
B) more substitutes will increase the elasticity of crude-oil based gasoline.
C) more substitutes will reduce the impact of supply shocks on the price of crude-oil based gasoline.
D) Any or all of the above.
D
You might also like to view...
Use the figure below to answer the following question. 
A decrease in supply is depicted by a
A. movement from point x to point y. B. movement from point y to point x. C. shift from S2 to S1. D. shift from S1 to S2.
A bottle of wine can be produced in France with two labor hours, and in the United States with four labor hours. A pound of beef can be produced in France with one labor hour, and in the United States with ½ labor hours. Given this context, which of the following is true?
A. The United States has both a comparative and absolute advantage in the production of beef. B. France has a comparative advantage in the production of beef. C. The United States has an absolute but not a comparative advantage in the production of beef. D. France has an absolute advantage in the production of beef.
Sachs and Warner found a strong correlation between a(n) ______ response to trade and economic growth.
Fill in the blank(s) with the appropriate word(s).
When the price of oysters decreases 25%, quantity demanded is unchanged. The price elasticity of demand for oysters is
A. unitary elastic. B. inelastic. C. elastic. D. perfectly inelastic.