An increase in government spending would cause which of the following to happen?
A)The aggregate demand curve would shift to the right.
B)The aggregate demand curve would shift to the left.
C)The aggregate supply curve would shift to the right.
D)The aggregate supply curve would shift to the left.

Question

Quizplus · Accepted Answer

An increase in government spending would lead to an increase in aggregate demand, as there would be more money flowing into the economy. This increased demand would lead to firms producing more output, and the aggregate demand curve would shift to the right.

An Increase in Government Spending Would Cause Which of the Following