Faced with the oil crisis of the mid-1970s, the U.S. Congress instituted Corporate Average Fuel Economy (CAFE) standards. These have been increased over time, most recently in 2010 for the 2012-2016 model years. (For detail on the CAFÉ standards, visit the Web site of the National Highway Traffic Safety Administration, www.nhtsa.dot. gov/fuel-economy.) These standards are aimed at increasing the fuel economy, or miles per gallon (MPG), of automobiles.
a. Briefly describe the expected environmental effect of increasing the MPG of automobiles, holding all else constant.
b. Serious criticism has been lodged against the CAFE standards because U.S. automakers res- ponded by using more plastics in automobiles (to make the cars lighter in weight) to meet the more restrictive CAFE standards. Explain how the use of this technology affects your answer to part
(a). Are there any other relevant issues associated with this manufacturing decision?