Suppose the Organization of Petroleum Exporting Countries (OPEC) Sharply Increased

question 39

Multiple Choice

Suppose the Organization of Petroleum Exporting Countries (OPEC) sharply increased the price of oil, which triggered higher inflation rates in the United States. This type of inflation is best classified as:

• A) pseudo-inflation.
• B) demand-pull inflation.
• C) cost-push inflation.
• D) hyperinflation.

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Definitions:

Balance Sheet

A financial statement that presents a company's assets, liabilities, and shareholders' equity at a specific point in time.

Income Statement

A financial statement that shows a company's revenues, expenses, and net income or loss over a specific period.

Acid Test Ratio

A financial metric that evaluates a company's ability to pay off its current liabilities with quick assets like cash, marketable securities, and accounts receivable.

Current Liabilities

Short-term financial obligations that are due within one year or within the normal operating cycle of a business.