Which of the following statements is TRUE?
A) When the price of oil is high, consumers will use oil for both valuable and less valuable uses.
B) When the price of oil is low, consumers will use oil only for its most valuable uses.
C) When the price of oil rises, consumers tend to use oil for uses in which there are few substitutes for it.
D) When the price of oil falls, consumers start to conserve oil and only use it when there are no other options.

Question

Quizplus · Accepted Answer

When the price of oil rises, consumers tend to use oil for uses in which there are few substitutes for it. This is because when the price of oil is high, consumers are willing to pay a higher price for oil, even for uses that may not be as valuable, because there are few substitutes for oil in certain uses. On the other hand, when the price of oil is low, consumers may only use it for its most valuable uses and seek out substitutes for less valuable uses.

Which of the Following Statements Is TRUE