If output is greater than planned aggregate expenditure, there will be

Question

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If output is greater than planned aggregate expenditure, it means that businesses are producing more goods than what is being demanded by consumers. As a result, there will be an unplanned increase in inventories as businesses have excess inventory that they did not plan for. This is because inventories represent goods that have been produced but not yet sold, and an excess of inventory means that businesses have overproduced relative to demand.

If Output Is Greater Than Planned Aggregate Expenditure, There Will