According to Say's law, a lack of demand
A) may occur briefly in one industry until capital moves to another industry.
B) will never occur in the aggregate economy for any reason.
C) occurs whenever there is insufficient income to purchase goods produced.
D) will occur frequently, because people tend to hoard money.

Question

Quizplus · Accepted Answer

According to Say's law, a lack of demand may occur briefly in one industry until capital moves to another industry. This is because the law assumes that supply creates its own demand and that producers will always find a way to sell what they produce. In the short run, however, some industries may face a lack of demand until they adjust their production and pricing strategies.

According to Say's Law, a Lack of Demand