In a small economy in 2016, aggregate expenditure was $800 million while GDP that year was $850 million. Which of the following can explain the difference between aggregate expenditure and GDP that year?
A) Aggregate expenditure is always less than GDP in developed countries.
B) Firm investment in inventories was greater than anticipated in 2016.
C) Aggregate expenditure is always less than GDP in developing countries.
D) Firm investment in inventories was less than anticipated in 2016.
B
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Which of the following is true?
A) Potential GDP fluctuates around nominal GDP. B) Nominal GDP fluctuates around real GDP. C) Real GDP never equals potential GDP. D) The Okun Gaps are much larger than the Lucas Wedge. E) Real GDP fluctuates around potential GDP.
Which of the following is a primary objective of monetary policy?
A) achieving a zero natural rate of unemployment B) targeting a zero rate of inflation C) achieving price stability D) all of the above E) none of the above
If two firms are producing the exact same product, it ________ possible for the firms to earn economic profit in a Cournot oligopoly and it ________ possible for the firms to earn economic profit in a Bertrand oligopoly.
A) is; is B) is not; is not C) is not; is D) is; is not
Assuming that beef and chicken are substitutes, an increase in the price of beef, other things being equal, will:
a. increase the demand for chicken. b. decrease the demand for chicken. c. not change the demand for chicken. d. decrease the demand for beef.