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Subject - Economics:

Miscellaneous

MCQ - 239-4249

Question:

When aggregate supply exceeds aggregate demand

  1. unemployment falls
  2. prices rise
  3. inventories accumulate
  4. prices rise

Correct Answer: C

Explanation:

Sol. Deflation sets in when aggregate supply exceeds aggregate demand. Recession sets in. This will lead to a buildup in stocks (inventories) and this sends a signal to producers either to cut prices (to stimulate an increase in demand) or to reduce output so as to reduce the buildup of excess stocks.

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269 MCQ for effective preparation of the test of Miscellaneous of Economics section.

Read the MCQ statement: When aggregate supply exceeds aggregate demand , keenly and apply the method you have learn through the video lessons for Miscellaneous to give the answer. Record your answer and check its correct answer and video explanation for MCQ No. 239-4249.

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Solve the question for MCQ No. and decide which option (A through D/E) is the best choice to answer the MCQ, then click/tap the blue button to view the correct answer and it explanation.

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