In the Keynesian framework,as long as output is ________ the equilibrium level,unplanned inventory investment will remain ________,firms will continue to raise production,and output will continue to rise.
A)below;negative
B)above;negative
C)below;positive
D)above;positive

Question

Quizplus · Accepted Answer

In the Keynesian framework, when output is below the equilibrium level, it means demand is higher than what is being produced, leading to a decrease in inventories (unplanned inventory investment becomes negative). Firms will respond by increasing production to meet the higher demand, causing output to rise until equilibrium is reached.

In the Keynesian Framework,as Long as Output Is ________ the Equilibrium