In the Keynesian model, a short-run increase in investment spending will shift the aggregate

Question

Quizplus · Accepted Answer

In the Keynesian model, an increase in investment spending will lead to an increase in aggregate demand. This is because increased investment spending leads to increased production and employment, which in turn lead to increased consumer spending. This shift in aggregate demand will shift the demand curve to the right. Therefore, the answer is D.

In the Keynesian Model, a Short-Run Increase in Investment Spending