When There Is a Recession, the Price of Oil Tends

question 97

Multiple Choice

When there is a recession, the price of oil tends to fall because:

• A) people drive more during recessions while looking for employment.
• B) the supply of oil increases during a recession, due to technological change.
• C) the prices of substitutes for oil rise during recessions.
• D) incomes fall during a recession, and oil is a normal good.

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Definitions:

Equity

The value of an owner's interest in a property or business, after subtracting liabilities.

Financial Asset

An asset that derives value from a contractual claim, such as cash, ownership interest in an enterprise, a bond, stock, or right to receive cash from a contract.

Accounts Receivable

Money owed by customers to a company for goods or services that have been delivered or used but not yet paid for.