Consider a Simple Macro Model with a Constant Price Level

Multiple Choice

Consider a simple macro model with a constant price level and demand- determined output. In such a model, the level of national income will

A) remain constant if firms are accumulating inventories.
B) tend to rise if firms have unplanned decumulation of inventories.
C) tend to rise if desired aggregate expenditure is less than actual national income.
D) be in equilibrium if all of the resources of the economy are fully employed.
E) remain constant if savings equals consumption.