Which of these is an effect of deficient demand?

Prices rise sharplyCorrect answerYour answerFirms' stocks run downCorrect answerYour answerOutput rises beyond full employmentCorrect answerYour answerOutput and employment fallCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer D

Correct answer: D

Unsold goods pile up, so firms cut production and lay off workers.

Concept: Effects of deficient demand
Typical timeTypical: 70 s
Your timeYours: —

The rule this testsDeficient demand and the deflationary gap

Practise this chapter →

Ten questions from Excess & Deficient Demand, at your own pace.

Practise this chapter →

Ten questions from Excess & Deficient Demand, at your own pace.

Practise this chapter All 53 questions in Excess & Deficient Demand Revise the notes for Excess & Deficient Demand

Which of these is an effect of deficient demand?

Explanation