If Expenditure by the Government of a Country Increases,________

question 175

Multiple Choice

If expenditure by the government of a country increases,________.

• A) the GDP of the country will increase
• B) the aggregate price level of the country will decrease
• C) the country's expenditure on consumption will decrease
• D) the unemployment rate in the country will increase

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Definitions:

Checks and Balances

Checks and balances is a principle in government where separate branches are empowered to prevent actions by other branches and are induced to share power, ensuring no single branch becomes too powerful.

Branches

Divisions or offshoots of a larger organization, company, or government that operate semi-autonomously, often with a specific local or functional focus.

Influence

The capacity to have an effect on the character, development, or behavior of someone or something, or the effect itself.

Spending Power

The financial ability or capacity of an entity (individual, government, or organization) to make purchases or invest, influencing economic activity.