According to the Traditional Keynesian Approach, If the Government Increases

question 3

Multiple Choice

According to the traditional Keynesian approach, if the government increases spending by $5 million and raises current taxes by $5 million at the same time, then

• A)real GDP will increase by $5 million.
• B)real GDP will decrease by $5 million.
• C)real GDP will decrease by more than $5 million.
• D)real GDP will remain the same.