What is the primary effect of an increase in government spending on aggregate demand in the economy?

When the government increases its spending, it directly adds to the total demand in the economy, known as aggregate demand. This means that the government is buying more goods and services, which can lead to more jobs and higher income for workers. For example, if the government decides to build a new highway, it hires construction workers and buys materials, which increases economic activity. As these workers earn money, they will spend it on other goods and services, creating a ripple effect that further boosts demand. Overall, this increased spending helps stimulate the economy, especially during times of economic slowdown.