When Government Spending Flows to Areas Where Resources Are Already

question 93

Multiple Choice

When government spending flows to areas where resources are already fully employed,

• A) the additional spending will stimulate strong growth in those areas.
• B) aggregate demand will place downward pressure on the general level of prices.
• C) the coordination problem accompanying the composition of aggregate demand is likely to improve.
• D) the coordination problem accompanying the composition of aggregate demand is likely to worsen.

---

Definitions:

Risk Response Plan

A strategic approach to identifying, assessing, and developing options and actions to deal with potential threats or opportunities.

Total Risk

The complete range of potential threats to the success of a project or investment, encompassing both known risks and those that cannot be anticipated.

Risk Breakdown Structure

A hierarchical decomposition of risks into categories and subcategories, intended to organize and manage risks more effectively.

Risk Avoidance

A strategy aimed at eliminating or avoiding specific threats or risks to project or business activities.