Suppose the majority of students who are graduating in May from a large university have found jobs and signed employment contracts by February.Starting in February,these students are likely to ________ spending,and aggregate demand will ________.
A) increase; increase
B) decrease; decrease
C) decrease; increase
D) increase; decrease
E) not change their rate of; not change

Question

Quizplus · Accepted Answer

If the majority of students have found jobs and signed employment contracts by February, it is likely that they will have more disposable income and therefore increase their spending, leading to an increase in aggregate demand.

Suppose the Majority of Students Who Are Graduating in May