Assume Planned Aggregate Expenditure Exceeds Aggregate Output (Income)

question 40

Essay

Assume planned aggregate expenditure exceeds aggregate output (income). Explain what will happen to unplanned inventories and the adjustment process towards equilibrium output.

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Definitions:

Compounds

Substances formed by the chemical combination of two or more elements in definite proportions.

Tertiary Amine

An amine in which the nitrogen atom is connected to three alkyl or aryl groups, often characterized by strong bases and found in various organic compounds.

Compound

A substance formed from two or more chemical elements that have bonded together.

Secondary Amine

An amine where the nitrogen atom is bonded to two alkyl or aryl groups and one hydrogen atom.