CameraIcon

SearchIcon

MyQuestionIcon

14

You visited us 14 times! Enjoying our articles? Unlock Full Access!

Taxation as a Tool

Which of the ...

Question

Which of the following happens when aggregate supply exceeds aggregate demand?

A

Unemployment falls

No worries! We‘ve got your back. Try BYJU‘S free classes today!

B

Prices rise

No worries! We‘ve got your back. Try BYJU‘S free classes today!

C

Inventories accumulate

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

D

Unemployment develops

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is C Inventories accumulate
When aggregate demand unexpectedly falls it leads to reduced sales and as a result inventories accumulate. In the next period, production will be reduced due to the existence of previous inventories.

Suggest Corrections

thumbs-up

0

Similar questions

Q. What happens to the level of national Income when aggregate supply exceeds aggregate demand?

Q. When aggregate demand exceeds aggregate supply or when investment is greater than savings, _____________ will increase.

Q. When aggregate supply exceeds aggregate demand or when investment is less than savings, _____________ will decrease.

Q. If aggregate demand exceeds aggregate supply, the income rises.

Q. What happens to the level of national income when aggregate demand falls short of aggregate supply?

View More

Join BYJU'S Learning Program

similar_icon

Related Videos

lock

Taxation and Fiscal Policy

ECONOMICS

Watch in App

explore_more_icon

Explore more

Taxation as a Tool

Standard XII Economics

Join BYJU'S Learning Program

CrossIcon