Which of the Following Statements Regarding OPEC Is False

question 82

Multiple Choice

Which of the following statements regarding OPEC is false?

• A)Because it sells a homogeneous product, since its formation in 1960 OPEC has been the clear leader when it comes to determining the price of crude oil.
• B)OPEC's membership includes countries from the Middle East, Africa, and South America.
• C)Over time, OPEC's ability to control the price of oil has been constrained by changes in consumer demand and increased production of oil by non-member countries.
• D)The cartel has not always been successful when it comes to preventing individual members from cheating on the agreed upon production quotas.

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Definitions:

Direct Costs

Expenses that can be directly attributed to the production of goods or services, such as materials and labor.

Floatation Costs

Costs a company faces when issuing new securities, such as underwriter fees, legal charges, and registration expenses.

Firm Commitment

A firm commitment refers to an underwriter's agreement to assume all inventory risk and purchase all securities directly from the issuer for sale to the public.

Underwriter

A professional who assesses and accepts the risk of an insurance policy or security, determining pricing and coverage.