The Fact That New Methods to Extract Oil Are Developed

Multiple Choice

The fact that new methods to extract oil are developed as oil prices increase suggests

A) that methods of production do not change in response to factor-price changes.
B) that invention is exogenous.
C) that invention does respond to economic signals and is endogenous.
D) that oil has many close substitutes.
E) nothing; changes in technology occur regardless of market prices.