An article in the Wall Street Journal about companies drilling in shale oil fields notes that banks

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An article in the Wall Street Journal about companies drilling in shale oil fields notes that “banks have provided financing when [oil] producers spend more cash than they take in from operations.” If a company spends more to produce oil than it receives in revenue from selling the oil, isn’t it suffering a loss? If so, why does the company remain in business, and why are banks willing to lend it money?

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Macroeconomics

ISBN: 9780135801741

8th Edition

Authors: Glenn Hubbard, Anthony Patrick O Brien

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