If aggregate output is above its equilibrium level ________.
A)there is an excess supply of goods
B)actual output is below planned expenditure
C)firms will tend to replenish their low inventories driving output up toward equilibrium
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

When aggregate output is above its equilibrium level, it means that production has exceeded the aggregate demand, leading to an excess supply of goods. This situation prompts adjustments in the economy to return to equilibrium.

If Aggregate Output Is Above Its Equilibrium Level ________