This refers to an increase in government spending that produces a reduction in private spending

Which of the following statements is true?

A) When TP = TE (total production = total expenditures), the economy is necessarily producing Natural Real GDP. B) When TP is greater than TE, inventory levels unexpectedly fall. C) When TE is greater than TP, inventory levels unexpectedly rise. D) b and c E) none of the above

The long run is characterized by:

A. the relevance of the law of diminishing returns. B. at least one fixed input. C. the ability of the firm to change its plant size. D. insufficient time for firms to enter or leave the industry.