For a given level of inflation, if a rise in the stock market makes consumers more willing to spend, known as the wealth effect, then the ________ shifts ________.
A)aggregate demand curve; right
B)short-run aggregate supply line; downward
C)aggregate demand curve; left
D)short-run aggregate supply line; upward

Question

Quizplus · Accepted Answer

A sudden increase in household wealth will increase consumption spending, shifting the AD curve to the right.

For a Given Level of Inflation, If a Rise in the Stock