OPEC has coordinated a reduction in supply that was
A)effective in insulating the members from the decrease in demand in the late 2000s.
B)more profitable in the long run than in the short run.
C)profitable in both the short run and the long run.
D)more profitable in the short run than in the long run.

Question

Quizplus · Accepted Answer

The coordinated reduction in supply by OPEC was more profitable in the short run than in the long run. In the short run, the reduction in supply led to an increase in oil prices and thus higher profits for OPEC members. However, in the long run, the reduction in supply could lead to the development of alternative energy sources and a decrease in demand for oil, which could harm the profits of OPEC members in the future.

OPEC Has Coordinated a Reduction in Supply That Was