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Firms in a Small Economy Anticipated That Inventories Would Grow

Question 238

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Firms in a small economy anticipated that inventories would grow over the past year by $500,000.Over that year, inventories actually grew by only $400,000.This implies that


A) aggregate expenditure that year was greater than GDP that year.
B) there was an unplanned increase in inventories that year.
C) there was a planned increase in inventories that year.
D) aggregate expenditure that year was equal to GDP that year.
E) there was a rise in the unemployment rate.

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