When foreign income rises,U.S.aggregate
A) demand will shift to the right.
B) supply will shift to the right.
C) demand will shift to the left.
D) supply will shift to the left.
E) demand and aggregate supply will be unaffected.

Question

Quizplus · Accepted Answer

When foreign income rises, it means that there is an increase in demand for goods and services produced in the US. This leads to an increase in exports, which in turn shifts the aggregate demand curve to the right.

When Foreign Income Rises,U.S.aggregate