An increase in business inventories during a time period, ceteris paribus, will:
A. Decrease GDP during that period.
B. Increase GDP during that period.
C. Not affect GDP during that period but will increase GDP in later periods when the inventory is sold.
D. Never affect GDP because changes in inventories are not included in the calculation of GDP.
Answer:B
An increase in business inventories during a time period, ceteris paribus, will:
A. Decrease GDP during that period. B. Increase GDP during that period. C. Not affect GDP during that period but will increase GDP in later periods when the inventory is sold. D. Never affect GDP because changes in inventories are not included in the calculation of GDP.