An expenditure schedule that lies below the full employment level of GDP will cause

Question

Quizplus · Accepted Answer

If the expenditure schedule lies below the full employment level of GDP, it means that there is less demand for goods and services than there is supply. This would result in a surplus of goods and services, leading firms to reduce prices in order to sell their excess inventory. As a result, falling prices would be the most likely outcome in this scenario.

An Expenditure Schedule That Lies Below the Full Employment Level