You observe that unplanned inventories are increasing. You predict that there will be
A) a business cycle.
B) an expansion.
C) a trough.
D) a recession.

Question

Quizplus · Accepted Answer

When unplanned inventories increase, it typically indicates that goods are not being sold as expected, suggesting a decrease in consumer demand. This is often a precursor to a recession, as businesses may start to cut back on production and employment in response to the accumulation of unsold goods.

You Observe That Unplanned Inventories Are Increasing