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Country a Specializes in the Production of Automobiles,and 45 Percent

Question 64

Multiple Choice

Country A specializes in the production of automobiles,and 45 percent of its population works in the automobile manufacturing industry.A sharp increase in the world prices of automobiles led to a boom in the automobile manufacturing industry in Country A.However,the automobile manufacturers overestimated the demand for automobiles.This led to overproduction,which resulted in a large stock of unsold cars.Which of the following is likely to happen in the near future?


A) The unemployment rate in Country A will increase.
B) Household consumption in Country A will increase.
C) Investment in Country A will increase.
D) The supply of credit in Country A will increase.

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