Other Things Equal, an Increase in Government Spending Shifts

question 220

Multiple Choice

Other things equal, an increase in government spending shifts

• A) the AD curve to the left.
• B) the AD curve to the right.
• C) the AS curve to the left.
• D) the AS curve to the right.

---

Definitions:

Nominal Interest

The stated interest rate on a loan or investment, not accounting for inflation or compounding effects.

Compounded Nominal

Refers to the nominal interest rate which is compounded at certain intervals over a specified period but not necessarily reflecting the actual annual rate of return.

Annuity

An annuity is a financial instrument that provides a consistent series of payments to a person, often serving as a source of income for those who have retired.

Annuitant

The individual entitled to receive payments from an annuity contract, usually during retirement.