Real GDP is $13 trillion and aggregate planned expenditure is $14 trillion. As a result, unplanned inventory change is _{--------------------} and real GDP _{--------------------}. A)negative; decreases B)negative; does not change C)positive; increases D)negative; increases E)positive; decreases

Question

Quizplus · Accepted Answer

When aggregate planned expenditure exceeds real GDP, it indicates that demand is higher than the current production, leading to a decrease in unplanned inventories. This situation typically results in an increase in real GDP as production is ramped up to meet the higher demand.

Real GDP Is $13 Trillion and Aggregate Planned Expenditure Is