If business inventories decrease below desired levels,then it is likely that a
A)Higher level of unemployment will result.
B)Lower level of output will occur.
C)Higher price level will occur.
D)Recessionary gap will occur.

Question

Quizplus · Accepted Answer

When business inventories decrease below desired levels, it often indicates that demand is outpacing supply, which can lead to higher prices as businesses may raise prices to balance demand with their limited supply.

If Business Inventories Decrease Below Desired Levels,then It Is Likely