If the government increases military spending ________.
A)the IS curve would shift to the left
B)output will decrease if interest rates remain fixed
C)the unemployment rate could fall
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

An increase in government spending, including military spending, can stimulate economic activity by increasing demand. This can lead to higher output and potentially lower unemployment rates as businesses may need to hire more workers to meet the increased demand.

If the Government Increases Military Spending ________