Suppose that a rise in business confidence has led to more investment in the economy and higher levels of output. In the short-run Keynesian analysis, the rise in aggregate demand will:
A. lower unemployment.
B. cause government to lower taxes.
C. cause government to increase spending.
D. exports will drop.
Answer:A
Suppose that a rise in business confidence has led to more investment in the economy and higher levels of output. In the short-run Keynesian analysis, the rise in aggregate demand will:
A. lower unemployment. B. cause government to lower taxes. C. cause government to increase spending. D. exports will drop.
Explanation: Type: Multiple Choice