If firms sell what they expected to sell,which of the following will be true?
A)Aggregate expenditure will be greater than GDP.
B)There is no unplanned change in inventories.
C)Inventories will rise,and GDP and employment will fall.
D)Aggregate expenditure will be less than GDP.

Question

Quizplus · Accepted Answer

If firms sell what they expected to sell, there is no unplanned change in inventories. This means that their inventory level remains the same, and there is no need to adjust production or hiring. Hence, the correct answer is B. The other options are incorrect because they assume that there is either an increase or decrease in inventories or aggregate expenditure, which is not the case when firms sell what they expected to sell.

If Firms Sell What They Expected to Sell,which of the Following