A Shift of the Supply Curve of Oil Raises the Price

question 119

Multiple Choice

A shift of the supply curve of oil raises the price from $70 a barrel to $80 a barrel and reduces the quantity demanded from 40 million to 38 million barrels a day. You can conclude that the

• A) demand for oil is elastic.
• B) demand for oil is inelastic.
• C) supply of oil is elastic.
• D) supply of oil is inelastic.

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Definitions:

Accounting

A system that measures the business’s activities in financial terms, provides written reports and financial statements about those activities, and communicates these reports to decision makers and others.

Investors

Individuals or institutions that commit capital with the expectation of receiving financial returns.

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