Figure 12-1
-Refer to Figure 12-1.At point J in the figure above,which of the following is true?
A)Aggregate expenditure is less than GDP.
B)The economy has achieved macroeconomic equilibrium.
C)Actual inventories are less than planned inventories.
D)GDP will be decreasing.

Question

Figure 12-1 
-Refer to Figure 12-1.At point J in the figure above,which of the following is true?
A)Aggregate expenditure is less than GDP. 
B)The economy has achieved macroeconomic equilibrium. 
C)Actual inventories are less than planned inventories. 
D)GDP will be decreasing.

Quizplus · Accepted Answer

At point J, the actual inventories are below the planned inventories, indicating that firms have produced more than what consumers are currently demanding. Therefore, firms will likely decrease production in the future, leading to a decrease in GDP. Since aggregate expenditure is still above GDP, the economy has not yet achieved macroeconomic equilibrium.

Figure 12-1 -Refer to Figure 12-1.At Point J in the Figure Above,which