Which of the following observations would be consistent with the effect of oil speculation?
A) Society becomes worse off from speculation because speculators intend to drive up the price of oil.
B) Society becomes worse off as speculators decrease the value of oil by moving it to a time when its value is lower.
C) Society becomes better off as speculators increase the value of oil by moving it to a time when its value is higher.
D) Society is indifferent about the activities of speculators.

Question

Quizplus · Accepted Answer

Oil speculation involves buying and selling oil contracts with the expectation of profiting from changes in the future price of oil. This can lead to an increase in demand for oil contracts, which can drive up the price. However, speculators also help to increase liquidity in the oil market and can move oil to times or places where its value is higher. Therefore, society may become better off as a result of oil speculation.

Which of the Following Observations Would Be Consistent with the Effect