When there is unplanned inventory investment, aggregate planned expenditure is_________ real GDP and actual investment is _________planned investment.
A) less than; greater than
B) less than; less than
C) greater than; greater than
D) greater than; less than

Question

Quizplus · Accepted Answer

Unplanned inventory investment occurs when actual sales are less than expected, leading to an accumulation of unsold goods. This means that aggregate planned expenditure is less than real GDP, and actual investment (including unplanned inventory) is greater than planned investment.

When There Is Unplanned Inventory Investment, Aggregate Planned Expenditure Is_________