Brazil is the world's largest sugar cane producer and sugar cane can be used for producing sugar and fuel ethanol for automobiles. Which of the following sequence of events is correct?
A) Rising oil prices cause Brazilian producers to shift sugar cane production from sugar to fuel ethanol. The decrease in sugar supply raises the price of candy bars.
B) Rising oil prices cause Brazilian producers to shift sugar cane production from fuel ethanol to sugar. The increase in sugar supply decreases the price of candy bars.
C) Falling oil prices cause Brazilian producers to shift sugar cane production from sugar to fuel ethanol. The increase in sugar supply raises the price of candy bars.
D) Falling oil prices cause Brazilian producers to shift sugar cane production from fuel ethanol to sugar. The increase in sugar supply raises the price of candy bars.
Correct Answer:
Verified
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