If a Firm's Inventory Decreases,the GDP Counts the Net Decrease

question 121

True/False

If a firm's inventory decreases,the GDP counts the net decrease as a reduction in investment.

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Definitions:

Deadweight Loss

A loss of economic efficiency that occurs when the equilibrium for a good or service is not achieved or is not achievable.

Actual Production

The quantity of goods or services produced by a firm, industry, or economy within a specific period, factual and not estimated.

Consumer Surplus

The variance between what consumers are ready and capable of spending on a product or service and the actual sum they end up paying.

Producer Surplus

The difference between what producers are willing to accept for a good or service and the actual price they receive, reflecting the benefit to producers from higher prices.