For a Given Reduction in the Supply of Oil, the Equilibrium

question 95

Multiple Choice

For a given reduction in the supply of oil, the equilibrium price of oil will

• A)decrease by a larger amount for a higher price elasticity of demand.
• B)decrease by a smaller amount for a higher price elasticity of demand.
• C)increase by a larger amount for a higher price elasticity of demand.
• D)increase by a smaller amount for a higher price elasticity of demand.
• E)not change, regardless of the price elasticity of demand.

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Definitions:

Balance Sheet

A financial statement showing a company's assets, liabilities, and shareholders' equity at a specific point in time.

Income Statement

A financial report that shows a company's revenue, expenses, and profits over a specific period of time.

Profit Margin

A financial metric used to assess a company's profitability by dividing net income by revenue.

Net Income

is the amount of money that remains after all expenses, taxes, and costs have been subtracted from a company's total revenue, also known as the bottom line.