The Oil Shock of 2007-2008 Saw the Price of Oil

question 40

Multiple Choice

The oil shock of 2007-2008 saw the price of oil rising from less than $60 a barrel in March 2007 to over $145 a barrel in July 2008,and decreasing again to just over $30 a barrel in December 2008.Assuming the economy was at potential GDP prior to the oil shock,the increase in the price of oil,such as what occurred between March 2007 and July 2008,acts as a negative supply shock,causing the inflation rate to ________ and the output gap to ________.

• A) increase; become negative
• B) increase; become positive
• C) decrease; become negative
• D) decrease; become positive

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Definitions:

Sigmund Freud

An Austrian neurologist and the founding father of psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Social Psychologist

A scientist who studies how individuals think, influence, and relate to each other within a social context.

Personality Traits

Enduring characteristics or qualities that form an individual's distinct character, influencing behaviors and attitudes.

Theoretical Concept

A foundational idea or principle that forms the basis for a theory.