Use the figure below to answer the following questions.

Figure 26.2.1
-Refer to Figure 26.2.1. Which graph illustrates what happens when expected future income increases?
A)(a)only
B)(b)only
C)(c)only
D)(d)only
E)Both (a)and (c)

Question

Use the figure below to answer the following questions.
  
Figure 26.2.1
-Refer to Figure 26.2.1. Which graph illustrates what happens when expected future income increases?
A)(a)only 
B)(b)only 
C)(c)only 
D)(d)only 
E)Both (a)and (c)

Quizplus · Accepted Answer

When expected future income increases, people are likely to spend more in the present, leading to an increase in aggregate demand. This is typically illustrated by a rightward shift in the aggregate demand curve, which is shown in graph (c).

Use the Figure Below to Answer the Following Questions