In 1990 the UN Placed Trade Sanctions on Iraqi Oil

Multiple Choice

In 1990 the UN placed trade sanctions on Iraqi oil. In 1996, Iraq was allowed limited export of oil to make war reparations. What was the predicted effect of the two events on equilibrium price and quantity of oil?

A) The price fell initially, then rose (failing to return to its former low level) ; quantity fell and then rose
B) The price fell initially, then rose (failing to return to its former low level) ; quantity rose and then fell
C) The price rose initially, then fell (failing to regain its former losses) ; quantity fell and then rose
D) The price rose initially, then fell (failing to regain its former losses) ; quantity rose, then fell