In 2016, GDP was exactly equal to final sales. This implies that
A) there was accumulation of inventories that year.
B) there was a decline in inventories that year.
C) there was no change in inventories that year.
D) GDP did not grow that year compared to the year before.

Question

Quizplus · Accepted Answer

Final sales equal GDP minus changes in inventories. Since the question states that GDP was exactly equal to final sales, this means that there were no changes in inventories, and therefore answer C is correct. There was no inventory accumulation or decline and we cannot determine if GDP grew or not.

In 2016, GDP Was Exactly Equal to Final Sales