A temporary decrease in the price of oil would be considered a:
A. long-run supply shock.
B. demand shock.
C. short-run supply shock.
D. The changing price of oil would not affect any of these.
Answer: C
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Answer the following statements true (T) or false (F)
1. Concern with the level of employment in the economy is a macroeconomic issue. 2. Microeconomics is a study of aggregates in the economy. 3. An economy’s wealth consists of a multitude of consumer and capital goods. 4. Economic services lack the characteristic of transferability found in economic goods.
When compared to the price of laptop computers, college tuition in the United States has
A. fallen. B. risen. C. stayed the same. D. risen at the same rate as the CPI.
A company is insolvent when the value of its liabilities exceeds the value of its assets.
Answer the following statement true (T) or false (F)
Many art galleries keep 60% of the sale price of a painting. However, art galleries do not typically pay the artist while the painting hangs on the wall. This form of contingency contract may be efficient if
A) the artist is less risk averse than the gallery. B) the gallery is less risk averse than the artist. C) the artist is unable to diversify across galleries or paintings. D) the gallery is unable to diversify across artists of paintings.