Which statement best describes the Texas economy in the 1970s?
• Texas experienced a boom as a result of its diversified economy.
• Texas experienced a boom when an OPEC embargo caused the cost of oil to increase.
• Texas experienced a bust when the overproduction of oil led to a decline in prices.
• Texas experienced a bust when declining oil prices led to real estate and banking losses.
The statement that best describes the Texas economy in the 1970s is "Texas experienced a boom when an OPEC embargo caused the cost of oil to increase." The OPEC embargo of 1973 led to a significant increase in the price of oil, and since Texas was a major oil-producing state, it experienced a boom in its economy as a result.
The correct answer is: Texas experienced a boom when an OPEC embargo caused the cost of oil to increase.
To arrive at this answer, we can eliminate thedistractor options one by one.
- Option 1: Texas experienced a boom as a result of its diversified economy. This option can be eliminated because it does not mention the specific reason for the boom.
- Option 3: Texas experienced a bust when the overproduction of oil led to a decline in prices. This option can be eliminated because it suggests a decline in oil prices, which is contrary to the idea of a boom.
- Option 4: Texas experienced a bust when declining oil prices led to real estate and banking losses. This option can also be eliminated because it refers to the state experiencing a bust, whereas the question asks for a boom.
This leaves us with the correct answer: Texas experienced a boom when an OPEC embargo caused the cost of oil to increase.
So, during the 1970s, Texas experienced an economic boom due to an OPEC embargo, which drove up the cost of oil. This led to increased revenue and job growth within the state.