A policy to increase aggregate demand to cure a recessionary gap may succeed;however,inflation is a likely result.

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When aggregate demand is increased, it can lead to higher prices as demand outpaces supply. This can result in inflation, which is a rise in the general level of prices of goods and services over time. Therefore, a policy to increase aggregate demand to cure a recessionary gap may succeed in alleviating the gap, but it can also lead to inflation.

A Policy to Increase Aggregate Demand to Cure a Recessionary