Which of the following reduced aggregate demand and thereby contributed to the crisis of 2008?
A) a rise in the value of the U.S. dollar
B) falling housing and stock prices
C) an increase in the real rate of interest
D) optimism about future economic conditions

Question

Quizplus · Accepted Answer

Falling housing and stock prices reduced household wealth and consumer spending, leading to a decrease in aggregate demand. The other options may have different effects on aggregate demand, but not necessarily reducing it.

Which of the Following Reduced Aggregate Demand and Thereby Contributed