When Aggregate Planned Expenditure Exceeds Real GDP

question 76

Multiple Choice

When aggregate planned expenditure exceeds real GDP,

• A) real GDP decreases.
• B) an unplanned increase in inventories occurs.
• C) firms decrease production.
• D) an unplanned decrease in inventories occurs.
• E) real GDP remains at its equilibrium level.

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Definitions:

Parasympathetic Nervous System

A division of the autonomic nervous system responsible for conserving energy and lowering the heart rate, aiding in digestion and the maintenance of bodily functions at rest.

Reticular Activating

Part of the reticular formation in the brainstem that plays a crucial role in controlling arousal and consciousness.

Medulla Oblongata

The lower portion of the brainstem, responsible for regulating vital functions like heartbeat, breathing, and blood pressure.

Anticholinergic Side Effects

Side effects resulting from the blockade of acetylcholine receptors, including dry mouth, blurred vision, constipation, and urinary retention.