what is the usual relationship between oil prices and oil production?Select all that apply.
The answer is A & D because with as production increases, price decreases 👍🌟
ms sue. you suck. were all on here for answers.
Wow.. She sucks because she can't help someone who didn't give answer choices? Really bro?
To determine the usual relationship between oil prices and oil production, we can consider several factors. Please note that these relationships are not always straightforward, as they are influenced by a multitude of factors such as global demand, geopolitical events, and market conditions. However, the following statements generally apply:
1. Positive correlation: When oil prices increase, it often incentivizes oil producers to ramp up their production. Higher prices can lead to increased profitability, which encourages the extraction of oil reserves. Thus, oil prices and oil production may show a positive correlation.
2. Negative correlation: Conversely, when oil prices drop significantly, producers may decrease their production. Lower prices can lead to reduced profitability or even losses, prompting producers to scale back their operations. Hence, oil prices and oil production may exhibit a negative correlation.
3. Lagged relationship: Changes in oil prices may not immediately translate into corresponding changes in oil production. There can sometimes be a delay before producers respond to price fluctuations by adjusting production levels. This lag in response can be attributed to various factors like production planning, investment decisions, and existing contractual agreements.
4. Resource availability: Oil prices and production can also be influenced by the availability of oil reserves. If new reserves are discovered or existing ones become economically viable due to technological advancements, production levels may increase, potentially driving prices down. Conversely, if reserves become depleted or harder to access, it can reduce production levels and potentially lead to higher prices.
It is important to note that while these statements generally hold true, the relationship between oil prices and production can vary in the short term and be influenced by numerous other factors.
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