A big increase in government spending is an example of a positive demand shock.
A demand shock is a sudden event that increases or decreases demand for goods or services temporarily. A positive demand shock increases aggregate demand and a negative demand shock decreases aggregate demand. Therefore there will be an initial inflation with the shock but since demand shocks are temporary and the central bank commits to an inflation rate target, then over time inflation will fall back down to the inflation target.
Expansionary fiscal policy is an increase in government spending or a decrease in taxation, while contractionary fiscal policy is a decrease in government spending or an increase in taxes. Expansionary fiscal policy can be used by governments to stimulate the economy during a recession.
Learn about positive demand shock:
brainly.com/question/14528859
#SPJ4
Answer:
What is the main point of Benjamin Franklins speech in the convention?
What is the main point of Benjamin Franklin's Speech in the Convention? The Constitutional Convention should support the Constitution because the document is as good as it is likely to be.
For more info
search
Write about why you agree on Ben Franklin's "Speech in the Convention". AT LEAST 6 sentences!! brainly
then click of the first link
The correct answer that would best fit the given statement above would be option D. The concept model is the most recognized model for explaining how concepts are formed. The conceptual model serves as a representation which is made of the concepts in order to assist the audience to know, understand and simulate a subject that the model represents.
