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Business, 09.04.2020 16:45 martinezarielys17

Suppose the island of Catsylvania experiences a recession. As a result, consumers reduce spending on Kitty Chow and planned aggregate expenditures fall short of real GDP. As a result, unplanned inventories at Kitty Chow firms will

A. decrease.
B. remain unchanged.
C. increase.

Thankfully, the recession is very short and consumer spending on Kitty Chow increases to prerecession levels. What is most likely to occur first at Kitty Chow firms during this period of recovery?

A. Firms will immediately increase production to meet increased demand.
B. Firms will sell off excess inventories before returning to increased production levels.
C. Firms will decrease current production to increase the price of Kitty Chow

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