In the Income-Expenditure Framework, Suppose Planned Aggregate Expenditures Are Greater

question 9

Multiple Choice

In the income-expenditure framework, suppose planned aggregate expenditures are greater than real GDP.How will inventories be affected?  

• A) Inventories will stay the same. 
• B) Inventories will first increase, and then decrease. 
• C) Inventories will increase. 
• D) Inventories will decrease.

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Definitions:

Signature Card

A document signed by an account holder that allows a bank to verify the account holder's signature on checks and other documents.

Authorized Persons

Individuals who are officially permitted to carry out specific actions within an organization or system.

Checks

Written, dated, and signed instruments that direct a bank to pay a specific sum of money to the bearer or a named party.

Cost-Benefit

An analysis or approach that compares the costs of an action to its benefits to determine its feasibility or value.