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In an ex-ante model,
When AD > AS, it will lead to,
When AD > AS, it will lead to,
- a)Planned inventory accumulation
- b)Fall in the planned inventory
- c)Unplanned inventory accumulation
- d)Fall in unplanned inventory
Correct answer is option 'B'. Can you explain this answer?
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In an ex-ante model,When AD > AS, it will lead to,a)Planned invento...
Excess Demand: When the planned aggregate expenditure is greater than the available output at full employment level, the situation is termed as excess demand
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In an ex-ante model,When AD > AS, it will lead to,a)Planned invento...
In an ex-ante model, the term "AD" typically refers to aggregate demand. Aggregate demand represents the total demand for goods and services in an economy at a given price level and period of time.
In an ex-ante model, aggregate demand is used to analyze the planned or intended demand for goods and services before it actually occurs. This means that the model focuses on the expectations and plans of economic agents, such as households, businesses, and the government, rather than actual realized demand.
By studying aggregate demand in an ex-ante model, economists can analyze the factors that influence planned demand, such as changes in consumer spending, investment levels, government spending, and net exports. This can help policymakers and analysts understand the potential impact of various economic policies and events on the overall level of demand in the economy.
In an ex-ante model, aggregate demand is used to analyze the planned or intended demand for goods and services before it actually occurs. This means that the model focuses on the expectations and plans of economic agents, such as households, businesses, and the government, rather than actual realized demand.
By studying aggregate demand in an ex-ante model, economists can analyze the factors that influence planned demand, such as changes in consumer spending, investment levels, government spending, and net exports. This can help policymakers and analysts understand the potential impact of various economic policies and events on the overall level of demand in the economy.
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In an ex-ante model,When AD > AS, it will lead to,a)Planned inventory accumulationb)Fall in the planned inventoryc)Unplanned inventory accumulationd)Fall in unplanned inventoryCorrect answer is option 'B'. Can you explain this answer?
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