If aggregate planned expenditures equal real GDP, then
A) inventories increase above their planned levels and businesses decrease their production.
B) inventories decrease below their planned levels and businesses increase their production.
C) there is no equilibrium level of real GDP.
D) inventories decrease below their planned levels and businesses decrease their production.
E) unplanned inventory changes equal zero.

Question

Quizplus · Accepted Answer

When aggregate planned expenditures equal real GDP, it means that all goods produced are being sold as expected, resulting in no unplanned changes in inventory levels.

If Aggregate Planned Expenditures Equal Real GDP, Then