Spending on the National Defence Force Is Categorised as Government

question 9

Multiple Choice

Spending on the national defence force is categorised as government purchases. How do increases in spending on defence affect the aggregate demand curve?

• A)This will move the economy up along a stationary aggregate demand curve.
• B)This will move the economy down along a stationary aggregate demand curve.
• C)This will shift the aggregate demand curve to the left.
• D)This will shift the aggregate demand curve to the right.

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Definitions:

Making Loans

The act of providing funds to an individual or organization with the expectation that the funds will be repaid, often with interest, over a specified period.

Creditors

Individuals or entities to whom money is owed by a debtor, who has borrowed funds or purchased goods/services on credit.

Bankruptcy

A judicial procedure allowing people or companies that are incapable of fulfilling their debt payments to obtain exemption from paying off some or all they owe.

Sell Interest

To transfer one's ownership stake in a company or property to another party, often for compensation.