Which of the following would cause a positive aggregate dema

Which of the following would cause a positive aggregate demand (AD) shock? A slower money growth. Increased import growth Faster growth of government spending. Decreased investment spending None of the above answers is correct.

Solution

Option 3. Faster growth of government spending

Explanation: When the government spends on goods and services, it increases the aggregate demand. A faster growth in government spending would cause a positive aggregate demand shock.