Tsuang Pey and Chang Jiang are debating economic growth in their country. Invent

Question

Tsuang Pey and Chang Jiang are debating economic growth in their country. Inventory in this closed agricultural economy is increasing and Tsuang thinks that this is a sure sign of declining demand and troubled times ahead. Chang, however, claims that the country has been through similar situations before but growth has never been too low for too long. He thinks that even if demand is currently low, things should improve in the medium term.

Which of the following statemnets is most strongly supported by the information given in the question?

A. Planned investment is currently equal to actual investment in this country.

B. Aggregate expenditure is currently lower than GDP.

C. Chang thinks that the country has never witnessed negative growth.

D. Unemployment in the country is expected to fall.

E. The inflation level in the economy is at its lowest ever.

Explanation / Answer

Answer:

C. Chang thinks that the country has never witnessed negative growth

Explanation:

In the given question, Chang thinks that the country has been through similar situations before, even the demand decreased. The growth has never been too low for too long, so there is no witness to negative growth in the country according to his view.

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