Suppose That Political Instability in the Middle East Interrupts the Supply

question 160

Multiple Choice

Suppose that political instability in the Middle East interrupts the supply of oil. The _____ curve shifts _____, output _____, and prices _____.

• A) short-run aggregate supply; right; increases; decrease
• B) short-run aggregate supply; left; decreases; increase
• C) aggregate demand; left; decreases; decrease
• D) aggregate demand; right; increases; increase

---

Definitions:

Black-Scholes

A mathematical model used for pricing European style options, taking into account the stock price, strike price, time to expiration, risk-free rate, and volatility.

Delta

In finance, it's a ratio that compares the change in the price of an asset, usually a marketable security, to the corresponding change in the price of its derivative.

Underlying Asset

The financial asset upon which a derivative's price, such as an option or future, is based.

Net Requirements

The total demand for a product or component minus the inventory already on hand or on order, used in manufacturing and inventory management.