Figure 6-12 -Refer to Figure 6-12.Which of the Following Statements Best Relates

question 128

Multiple Choice

Figure 6-12
-Refer to Figure 6-12.Which of the following statements best relates the figure to the events that occurred in the United States in the 1970s?

• A)Buyers of gasoline paid a price of P₁ before 1973;they paid a price of P₂ after OPEC increased the price of crude oil in 1973,and there was a shortage of gasoline at that price.
• B)Buyers of gasoline paid a price of P₁ before 1973;they paid a price of P₃ after OPEC increased the price of crude oil in 1973,and there was a shortage of gasoline at that price.
• C)Buyers of gasoline paid a price of P₂ before 1973;they paid a price of P₃ after OPEC increased the price of crude oil in 1973,with no shortage of gasoline at that price.
• D)The price ceiling was binding before 1973;the price ceiling was no longer binding after OPEC increased the price of crude oil in 1973.

---

Definitions:

Interest Rate Swap

A financial contract between two parties to exchange interest rate payments on a specified principal amount, often used to manage risk or alter interest rate exposure.

Floating Rate

An interest rate that fluctuates over time with the market or an index.

Fixed Rate

An interest rate that remains unchanged throughout the entire term of the loan, mortgage, or bond.

Derivative Security

A financial security whose value is dependent upon or derived from one or more underlying assets.