Since fall of 2004 increasing oil prices over 70 per barrel, Ask an Expert

Economics

Since fall of 2004, increasing oil prices [over $70 per barrel in the Spring of 2006] have frequently ended stock market rallies and led to refuse in all major stock indexes.

Make an AS/AD diagram which shows the effect on the United States macro-economy of oil at $70+/barrel versus oil at $40/barrel.
Label your diagram clearly and explain how higher oil prices impact either AS, AD, or both.

Finally, describe why rising oil prices have negatively impacted United States equity markets.

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M9308935

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