In the Aggregate Expenditures Model, If an Economy Operates Below

question 135

True/False

In the aggregate expenditures model, if an economy operates below equilibrium GDP, there will be unplanned inventory depletion.

---

Definitions:

Cheque Delay

A situation where there is a postponement in the processing or clearance of a cheque by a bank.

Average Daily Float

This refers to the average amount of uncollected checks or electronic transfers in the process of clearing.

Cheques

A written, dated, and signed instrument that directs a bank to pay a specific sum of money to the bearer.

Collection Delay

The time lag between the date an entity issues an invoice and the date it actually receives payment.