A key characteristic of the oil market is:
A) a price inelastic supply in the short run.
B) a price elastic demand in the short run.
C) oil production that often is in easily accessible areas.
D) a lack of supply disruptions.

Question

Quizplus · Accepted Answer

In the short run, the supply of oil is price inelastic because it takes time to explore, develop, and bring new oil supplies to the market. This means that even if prices increase, the quantity of oil supplied cannot be increased quickly.

A Key Characteristic of the Oil Market Is