-The data in the above table indicate that when the price level is 100
A) firms have unexpectedly low inventories, so prices will rise.
B) inventories are at levels planned by firms.
C) firms will plan to decrease the level of output.
D) firms have unexpectedly high inventories, so prices fall.

Question

-The data in the above table indicate that when the price level is 100
A) firms have unexpectedly low inventories, so prices will rise. 
B) inventories are at levels planned by firms. 
C) firms will plan to decrease the level of output. 
D) firms have unexpectedly high inventories, so prices fall.

Quizplus · Accepted Answer

When the price level is 100, firms experience unexpectedly low inventories because demand is higher than anticipated, leading them to increase prices to balance demand with supply.

-The Data in the Above Table Indicate That When the Price