Assume that in a private closed economy consumption is $240 billion and investment is $50 billion, both at the $280 billion level of domestic output. Thus:

A. saving is $10 billion.
B. unplanned decreases in inventories of $10 billion will occur.
C. the MPC is .80.
D. unplanned increases in inventories of $10 billion will occur.


B. unplanned decreases in inventories of $10 billion will occur.

Economics

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