Starting from the equilibrium position illustrated, government spending on goods and services rises while overall efficiency in producing goods and services falls at the same time. Which outcome is most likely for the economy?
- Aequilibrium level of national income: falls; equilibrium level of prices: uncertain
- Bequilibrium level of national income: no change; equilibrium level of prices: no change
- Cequilibrium level of national income: rises; equilibrium level of prices: rises
- Dequilibrium level of national income: uncertain; equilibrium level of prices: rises