not impact aggregate supply Higher government spending 1 In

not impact aggregate supply.

Higher government spending

1. In the short-run, a decrease in wage rates in an economy would

	increase aggregate supply.
	decrease aggregate supply.
	cause a movement up the AS curve.
	cause a movement down the AS curve.
	not impact aggregate supply.

1) In the short run if wage rate decreases, short-run aggregate supply increases. supply curve shifts to the right as a result price decreases and quantity increases. The first option is correct.

2) Strongest source of long-term economic growth is higher investment tax credit. Investment tax credit let individuals and businesses to deduct a certain percentage of investment cost from their taxes. As a result investment increases. Investment earns return so it is helpful for long-term economic growth. The capital stock purchase also is an investment but the fewer purchase may not be benefited. The first option is correct.

not impact aggregate supply. Higher government spending 1. In the short-run, a decrease in wage rates in an economy would increase aggregate supply. decrease ag

not impact aggregate supply Higher government spending 1 In

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