If Total Planned Expenditures Exceed Real GDP, the Economy Will

question 81

True/False

If total planned expenditures exceed real GDP, the economy will contract, causing production of goods and services to decrease and unplanned inventories to rise.

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Definitions:

Reversing Entries

Journal entries that are made at the beginning of an accounting period to reverse or cancel out adjusting journal entries made at the end of the previous accounting period.

Assets

Resources owned by a company that have economic value and can provide future benefits.

Liabilities

Liabilities are financial obligations or debts owed by a business to others, which must be settled over time through the transfer of economic benefits including money, goods, or services.

Reversing Entry

An accounting entry that is made at the beginning of an accounting period to reverse or cancel out a previously made adjusting entry.