Real GDP is $5 trillion and aggregate planned expenditure is $7 trillion.As a result, unplanned inventory change is ________ and real GDP ________.
A) positive; decreases
B) positive; increases
C) negative; increases
D) negative; decreases
E) negative; does not change

Question

Quizplus · Accepted Answer

When aggregate planned expenditure exceeds real GDP, it indicates that demand is higher than production, leading to a decrease in unplanned inventories and an increase in real GDP as firms ramp up production to meet demand.

Real GDP Is $5 Trillion and Aggregate Planned Expenditure Is