When Aggregate Planned Expenditure Is Less Than GDP

question 59

Multiple Choice

When aggregate planned expenditure is less than GDP,

• A) the economy definitely is at its equilibrium expenditure and firms do not change production.
• B) the economy definitely is at its equilibrium expenditure but, even so, firms decrease production.
• C) the economy might be at its equilibrium expenditure and, if it is, firms do not change their production.
• D) firms increase production until the economy reaches equilibrium expenditure.
• E) firms decrease production until the economy reaches equilibrium expenditure.

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Definitions:

Entered Into

Refers to the act of formally agreeing to or engaging in an agreement, contract, or arrangement.

Emancipation

The legal process allowing a minor to gain independence from their parents or guardians, assuming adult responsibilities.

Legal Guardians

Individuals or entities appointed by a court to care for and manage the personal and/or property interests of a minor or legally incapacitated person.

Legal Control

The authority to direct the legal actions of an entity, person, or property, as recognized by law.