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QuizMultiple Choice

5.4 Economic Policy: Influential Theories

Question 1 • * HSA 26-27 Economics

A government might enact expansionary spending when it is trying to

Answer
A
increase aggregate demand for goods.
B
decrease aggregate demand for goods.
C
slow an economic expansion.
D
lower a budget deficit.

Explanation

Expansionary government spending means increasing purchases of goods and services or other spending to stimulate the economy. This raises aggregate demand, so the correct choice is “increase aggregate demand for goods.”

AI-written and checked against the verified answer.

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