When crowding out occurs in an economy, it can reduce expenditures for

In the above figure, point E represents the level of real GDP at which planned saving equals planned investment. At point C

A) changes in inventories cannot be determined. B) unused industrial capacity exists in the economy. C) unplanned inventories increase. D) unplanned inventories decrease.

Sandra consumes two goods–tea and coffee. Her demand for tea is inelastic while her demand for coffee is elastic. If there is an increase in the price of both tea and coffee, ________

A) Sandra's expenditure on both tea and coffee is likely to increase B) Sandra's revenue on both tea and coffee is likely to decrease C) Sandra's expenditure on tea will increase and her expenditure on coffee will decrease D) Sandra's expenditure on coffee will increase and her expenditure on tea will decrease