If the government increases government spending,then the

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Quizplus · Accepted Answer

When the government increases its spending, it leads to an increase in demand for goods and services in the economy. This increase in demand leads to a shift in the aggregate demand curve to the right, as the government is a major player in the economy and its spending affects the overall demand for goods and services. The short-run aggregate supply curve may also shift to the right as firms increase production to meet the increased demand in the short-term, but in the long run, the aggregate supply curve is determined by factors like technology, resources, and institutions, and is not affected by changes in government spending.

If the Government Increases Government Spending,then the