In the short-run macro model,the change in inventories will
A) equal output minus aggregate expenditures
B) trigger a price change
C) equal investment minus depreciation
D) equal sales minus investment
E) be matched by an equal and opposite change in the subsequent period

Question

Quizplus · Accepted Answer

In the short-run macro model, the change in inventories is a key component of calculating output, as it reflects the difference between goods produced (output) and goods sold (aggregate expenditures). Therefore, option A is the correct choice. Option B is incorrect as changes in inventories do not necessarily trigger price changes, and option C and D are irrelevant to the question. Option E is not necessarily true, as changes in inventories may not always have an equal and opposite change in subsequent periods.

In the Short-Run Macro Model,the Change in Inventories Will