An increase in the price of oil will tend to cause which of the following?

Question

Quizplus · Accepted Answer

An increase in the price of oil will increase the cost of production, which will lead to an increase in the price level. It will also increase the cost of borrowing, which will lead to an increase in the interest rate. Finally, it will make it more expensive for businesses to hire workers, which will lead to an increase in the natural rate of unemployment.

An Increase in the Price of Oil Will Tend to Cause