In the short-run macro model,if firms produce more output than they sell,those firms will
A) increase the prices of their products
B) decrease their output
C) increase their output
D) cut back on their consumption spending
E) increase the prices of their products and reduce the amount of output they produce

Question

Quizplus · Accepted Answer

If firms produce more output than they sell, they will be left with unsold inventories. To clear their inventories, firms will reduce their output in the short run.

In the Short-Run Macro Model,if Firms Produce More Output Than