Which of the following would be most likely to cause an increase in current aggregate demand in the United States?
A) increased fear that the U.S. economy was going into a recession
B) an increase in the real interest rate
C) sharp increase in the value of stocks owned by Americans
D) a recession in Canada, Mexico, and Western Europe

Question

Quizplus · Accepted Answer

An increase in the value of stocks owned by Americans would give consumers more wealth and confidence, leading to increased consumption and investment spending, thereby increasing aggregate demand. A, B, and D would have the opposite effect by reducing consumer and business confidence and decreasing spending.

Which of the Following Would Be Most Likely to Cause