Unplanned inventory decreases:
A) tend to result in a decrease in income.
B) tend to result in an increase in real output.
C) tend to further reduce production.
D) signal that demand was weaker than expected.

Question

Quizplus · Accepted Answer

Unplanned inventory decreases indicate that sales were higher than expected, leading firms to increase production to replenish inventory, thus increasing real output.

Unplanned Inventory Decreases