Problem
Recall that the long-run world oil demand equation is Upper Q equals 41.6 minus 0.12 Upper PQ=41.6-0.12P and the long-run total oil supply equation is Upper Q equals 26.3 plus 0.071 Upper PQ=26.3+0.071P. The long-run equilibrium price is $80.10 and the long-run equilibrium quanity is 31.99 bb/yr. Continue to consider a 2.002.00bb/yr reduction in oil supply by Saudi Arabia. As a result of this change insupply, thelong-run equilibrium price of oil would be increase/decrease by how much in dollars?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.