Refer to the information provided in Table 8.10 below to answer the questions that follow.
Table 8.10
-Refer to Table 8.10. If aggregate output equals ________, there will be a $100 million unplanned decrease in inventories.
A) $2,400 million
B) $2,800 million
C) $3,200 million
D) $3,600 million

Question

Refer to the information provided in Table 8.10 below to answer the questions that follow.
Table 8.10 
-Refer to Table 8.10. If aggregate output equals ________, there will be a $100 million unplanned decrease in inventories.
A) $2,400 million 
B) $2,800 million 
C) $3,200 million 
D) $3,600 million

Quizplus · Accepted Answer

The correct answer is A because when aggregate output equals $2,400 million, there will be a $100 million unplanned decrease in inventories. This is because at this level of output, businesses are producing more goods and services than consumers are buying, so businesses will have to reduce their inventories to match the lower level of demand.

Refer to the Information Provided in Table 8