When aggregate demand decreases, producers find that their goods remain unsold. These unsold goods accumulate in warehouses as unintended inventory, leading to stocks piling up. The passage directly states: stocks are piling up in warehouses and producers decide to cut value of production.
What will be the effect on stocks when aggregate demand decreases ?
CUET UG 2023 — Economics Macro
2023mcqeasy
What will be the effect on stocks when aggregate demand decreases ?
Official previous-year question
Verified 13 Jul 2026.
Options
- A
Stocks in the economy will decrease
- B
Stocks will be piled up in warehouses
- C
Stocks will remain unchanged
- D
Producers will increase the stocks
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