Recall the Application About Energy Price Uncertainty and Its Impact

question 23

Multiple Choice

Recall the Application about energy price uncertainty and its impact on investment spending and GDP growth to answer the following question(s) . Increases in oil prices can lead to a drop in GDP. However, uncertainty about oil prices is also an important factor. The volatility of oil prices creates uncertainty for firms making investment decisions, and adversely affects GDP growth.
-According to this Application, the volatility of energy prices can contribute to uncertainty in the economy. An increasingly uncertain future will tend to cause firms to

• A) delay their investment decisions.
• B) wait for significant GDP growth before reducing investments.
• C) rely on the government to make their investment decisions for them.
• D) continue with a stable flow of investment spending so as not to get trapped by a downturning economy.