A Reduction in the Supply of Oil Is a Real

question 167

Multiple Choice

A reduction in the supply of oil is a real shock because it:

• A) makes gasoline more expensive for consumers.
• B) raises the profits of oil producers.
• C) makes labor and capital less productive.
• D) reduces the amount of oil consumption.

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Definitions:

Financial Asset

An intangible asset that derives value from a contractual right or ownership claim, such as stocks, bonds, or bank deposits.

Company's Profits

The financial gain realized when the revenues generated from business activities exceed the expenses, costs, and taxes needed to sustain the activities.

Interest

The cost of borrowing money or the return earned on an investment, typically expressed as a percentage.

Accounting Period

A specific time period at the end of which an organization prepares financial statements.