Which of the Following Events Shifts Aggregate Demand Rightward

question 116

Multiple Choice

Which of the following events shifts aggregate demand rightward?

• A)an increase in government expenditures or a decrease in the price level
• B)a decrease in government expenditures or an increase in the price level
• C)an increase in government expenditures,but not a change in the price level
• D)a decrease in the price level,but not an increase in government expenditures

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Definitions:

Fiscal Policy

Government policies related to taxation and public spending designed to influence economic conditions, such as inflation, employment, and economic growth.

Government Spending

Expenditures made by the government sector including spending on goods and services, public projects, and social programs.

Taxes

Mandatory financial charges or levies imposed by a government on individuals, corporations, and other entities to fund public expenditures.

Inflationary

Pertaining to inflation, describing a situation or trend where prices for goods and services rise over time, diminishing purchasing power.