3.In 1974 the cutback in oil production by the OPEC cartel created shortages of oil in the world market. In the United States price controls prevented oil prices and thus gasoline prices from rising to world market levels. In Europe and Canada oil and gasoline prices rose to world market levels. In the United States lines of cars formed at service stations, while there were no lines in Canada. Why?
2006-07-26 06:59:06 · 2 answers · asked by Anonymous in Education & Reference ➔ Homework Help
First the main reason for price hike in crude oil is shortage of oil supplies.
In europe and canada because of "free market", as the price of gasoline were increased the demand for gas reduced (because people were not willing to buy at high price). So less people were willing to buy therefore no lines.
On the other hand US tried to follow "price control" so the demand for gasoline stayed high and the affect of this shortage was reflected in long lines.
2006-07-26 07:31:20 · answer #1 · answered by shikhil_m 1 · 0⤊ 0⤋
Because you were limited on the number of gallons of gas you could buy at one time.
2006-07-26 14:04:09 · answer #2 · answered by kny390 6 · 0⤊ 0⤋