If aggregate quantity supplied exceeds aggregate quantity demanded, we can expect an unplanned
A. depletion of inventories, causing firms to raise prices.
B. depletion of inventories, causing firms to lower prices.
C. accumulation of inventories, causing firms to raise prices.
D. accumulation of inventories, causing firms to lower prices.
Answer: D
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Which combination of factors would most likely increase aggregate demand?
A. An increase in household indebtedness and a decrease in foreign demand for products. B. An increase in personal taxes and a decrease in government spending. C. An increase in consumer wealth and a decrease in interest rates. D. An increase in business taxes and a decrease in profit expectations.
What is the marginal rate of substitution between two goods and how is it related to the indifference curve?
What will be an ideal response?
Refer to Table 2-1. Assume Dina's Diner only produces sliders and hot wings. A combination of 40 sliders and 50 hot wings would appear
A) along Dina's production possibilities frontier. B) inside Dina's production possibilities frontier. C) outside Dina's production possibilities frontier. D) at the vertical intercept of Dina's production possibilities frontier.
Which of the following illustrates the law of demand?
A) More people watch college basketball in March than in November. B) The number of long distance calls in the United States is greater on Christmas than on Valentine's Day. C) College enrollment increases when federal tuition grants are readily available to students. D) The prevailing wage rate in an industry determines how many people choose to work in the industry.