Changes in the price of oil
A)can only lead to recessions.
B)have not contributed much to output fluctuations in the United States.
C)change the economy principally by changing aggregate demand.
D)created both inflation and recession in the United States in the 1970s.

Question

Quizplus · Accepted Answer

Changes in the price of oil can have significant impacts on the economy, including creating both inflation and recession as seen in the United States in the 1970s. However, it is not accurate to say that they can only lead to recessions or that they have not contributed much to output fluctuations in the United States. Additionally, while changes in oil prices can impact aggregate demand, they can also affect other aspects of the economy such as production costs and consumer spending.

Changes in the Price of Oil