Which of the following will increase macroeconomic equilibrium real gross domestic product?
A)an increase in government spending.
B)a decrease in productivity.
C)an increase in taxes.
D)an increase in input prices.

Question

Quizplus · Accepted Answer

An increase in government spending will lead to an increase in aggregate demand, which in turn will increase macroeconomic equilibrium real Gross Domestic Product (GDP). Option B, C, and D will all decrease aggregate supply and, therefore, reduce output and GDP.

Which of the Following Will Increase Macroeconomic Equilibrium Real Gross