The GDP for the Nation of Economia Is Currently Below

Multiple Choice

The GDP for the nation of Economia is currently below potential output. If the adjustment to the long-run equilibrium occurs rapidly, the government of Economia is likely to pursue a policy of

A) increasing government spending to increase aggregate demand.
B) increasing the money supply to increase aggregate demand.
C) taking no action and allowing the economy to adjust naturally.
D) decreasing government spending to increase aggregate demand.