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

Question

Unplanned inventory increases:
A)​tend to result in an increase in income.
B)​tend to result in an increase in real output.
C)​result in an increase in production.
D)​signal that demand was weaker than expected.

Quizplus · Accepted Answer

Unplanned inventory increases indicate that businesses produced more than what was demanded, resulting in excess inventory. This suggests that demand was weaker than expected, as businesses would not have produced more than necessary if demand was strong.

Unplanned Inventory Increases