waht happens when ad>as
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Explanation:
when as is less than Aggregate supply,then the planned inventory rises above and desired level . to clear the unwanted increases in inventory ,firms plan to reduce the production output till Aggregate demand becomes equal to Aggregate supply
When Aggregate demand is more than Aggregate supply , then the planned inventory would fall below the desired level as the demand is more than the supply in the market
... Rises in output means rise in a AS and rise in income means rise in AD
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