If total planned spending (E(p))exceeds GDP,we expect that
A)inventories will be falling.
B)inventories will be rising.
C)GDP will be falling.
D)government expenditures must be rising.

Question

Quizplus · Accepted Answer

When total planned spending exceeds GDP, it means that consumers and businesses are spending more than the economy is producing, leading to a decrease in inventories as goods are being purchased faster than they are being produced.

If Total Planned Spending (E(p))exceeds GDP,we Expect That