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Spending on the Military Is Essentially Categorized as Government Purchases

Question 9

Multiple Choice

Spending on the military is essentially categorized as government purchases.How do increases in spending on a military campaign affect the aggregate demand curve?


A) They will move the economy down along a stationary aggregate demand curve.
B) They will move the economy up along a stationary aggregate demand curve.
C) They will shift the aggregate demand curve to the right.
D) They will shift the aggregate demand curve to the left.
E) As military personnel are not considered part of the labour force, a military campaign will have no impact on the economy.

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