In the Keynesian model, whenever planned saving is less than planned investment
A)there will be unplanned inventory accumulation.
B)there will be unplanned inventory depletion.
C)real GDP will not be influenced.
D)the interest rate will remain unchanged.

Question

Quizplus · Accepted Answer

When planned saving is less than planned investment, it indicates that aggregate demand exceeds aggregate supply, leading to unplanned inventory depletion as businesses sell more than they anticipated.

In the Keynesian Model, Whenever Planned Saving Is Less Than