Analyze the politicians effect on gasoline market

The rash of hurricanes which pelted the Gulf Coast in the year of 2005 resulted in a large decline in gasoline production as several offshore rigs were shut down and several refineries were taken off line whereas waiting out the hurricane. The decrease in supplies of gasoline led to a run up in prices. Several voters clamoured for relief by calling on their congressman & senators to enact temporary price controls. Analyze the effect on the gasoline market which would have transpired had politicians in fact headed the calls by voters to impose price controls on gasoline.

If temporary controls had been put in effect the probable impact on the market would have been to make a shortage of gasoline. Put simply, it would have resulted in long lines at gas stations & other means of rationing gas such as customers try to look for ways around the price control.

 

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