Actual investment will equal planned investment only when
A)there is an unplanned increase in inventories.
B)there is an unplanned decrease in inventories.
C)there is no unplanned change in inventories.
D)companies have no inventories.

Question

Quizplus · Accepted Answer

Planned investment is the intended investment made by companies based on their forecasted sales and production. Actual investment is the actual amount of investment made by companies. If there is no unplanned change in inventories, this means that the actual sales and production matched the forecasted sales and production, and there were no unexpected changes in the amount of inventory held by the company. In this case, actual investment will equal planned investment. Therefore, option C is the correct answer.

Actual Investment Will Equal Planned Investment Only When