A federal policy that leads to an increase in aggregate supply is likely to result in:
A)lower levels of employment.
B)an increase in aggregate demand.
C)a higher price level.
D)lower levels of real GDP.
E)an economic expansion.

Question

Quizplus · Accepted Answer

A federal policy that leads to an increase in aggregate supply will increase the availability of goods and services in the economy, which will lead to a decrease in prices and an increase in real GDP. This increase in production and availability of goods and services will also stimulate economic expansion.

A Federal Policy That Leads to an Increase in Aggregate