If an Unintended Increase in Business Inventories Occurs at Some

question 103

Multiple Choice

If an unintended increase in business inventories occurs at some level of GDP, then GDP

• A) entails a rate of aggregate expenditures in excess of the rate of aggregate production.
• B) may be either above or below the equilibrium output.
• C) is too low for equilibrium.
• D) is too high for equilibrium.

---

Definitions:

Exclusion

The act of denying someone's access to a particular resource or activity.

Common Resource

A type of good that is non-excludable and rivalrous, such as fish stocks in the ocean; it is available to all but can be depleted by excessive use.

Public Good

A good that is both nonexcludable and nonrival in consumption.

Fire Protection

A range of measures and services designed to minimize the impact of fire on people, property, and the environment.