Which statement 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 holding oil futures contracts with the expectation of profiting from price increases. This increases the demand for futures contracts and the price of oil, causing the current value of oil to increase. Therefore, society becomes better off as speculators increase the value of oil by moving it to a time when its value is higher.

Which Statement Would Be Consistent with the Effect of Oil