Recall the Application About Oil Price Fluctuations in the U

question 15

Multiple Choice

Recall the Application about oil price fluctuations in the U.S. economy to answer the following
question(s) . During the 1970s, the world economy was hit with a series of supply shocks which impacted
the prices of oil and many agricultural commodities. Since the United States is a net importer of oil, the
changes in oil prices also had an impact on aggregate demand. During the 1990s, the world economy
experienced favorable supply shocks in the oil market, but in 2008, world oil prices skyrocketed to $145 a
barrel before falling again in 2009 and 2010.
-According to this Application, the increase in oil prices in 2008 was largely due to

• A)decreased world supply.
• B)increases in government regulations.
• C)increased world demand.
• D)price floors in the oil market.

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