During the Great Recession,the U.S.aggregate demand curve shifted to the left,in part,because
A) there was an increase in expected income.
B) the government dramatically increased taxes.
C) there was a decrease in expected income.
D) the Federal Reserve increased interest rates.
E) U.S.housing prices increased.

Question

Quizplus · Accepted Answer

The decrease in expected income resulted in decreased spending by households, businesses, and the government, which shifted the aggregate demand curve to the left. The other choices would have had the opposite effect and shifted the aggregate demand curve to the right.