In the Keynesian Framework,as Long as Output Is ________ the Equilibrium

question 95

Multiple Choice

In the Keynesian framework,as long as output is ________ the equilibrium level,unplanned inventory investment will remain ________,firms will continue to raise production,and output will continue to rise.

• A)below;negative
• B)above;negative
• C)below;positive
• D)above;positive

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Definitions:

Level of Activity

A measure of the volume of production, operation, or work undertaken by a business or facility within a particular time period.

Unit Variable Cost

A cost that varies directly with the production volume, including materials and labor directly involved in production.

Units of Activity

A depreciation method that allocates an asset's cost based on its usage, activities, or units produced, rather than the passage of time.

Total Fixed Costs

The sum of all costs that do not change with the level of output or sales, over a specific period.