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When the Aggregate Supply curve is in the Intermediate Phase, if the US Federal government increases deficit spending and cuts taxes on individual consumers then:

When the Aggregate Supply curve is in the Intermediate Phase, if the US Federal government increases deficit spending and cuts taxes on individual consumers then:

Answer Choices:

a) C and G increase, Aggregate Demand increases, Real GDP increases and the Price Level (Pl) stays the same

b) C and G increase, Aggregate Demand increases, Real GDP increases and the Price Level (Pl) increases and unemployment increases

c) C and G decrease, Aggregate Demand increases, Real GDP increases and the Price Level (Pl) increases

d) C and G increase, Aggregate Demand increases, Real GDP decreases and the Price Level (Pl) increases

e) C and G increase, Aggregate Demand increases, Real GDP increases and the Price Level (Pl) increases

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