Which of the following increases aggregate demand and shifts the AD curve rightward?
A) predictions of a recession that lead to expectations of lower future income
B) an increase in the quantity of money and a resulting fall in the interest rate
C) a fall in the price level
D) an increase in the exchange rate that makes imports less expensive

Question

Quizplus · Accepted Answer

An increase in the quantity of money causes a fall in the interest rate, which stimulates consumption and investment spending, increasing aggregate demand and shifting the AD curve rightward. Choices A, C, and D are incorrect as they decrease aggregate demand and shift the AD curve leftward.

Which of the Following Increases Aggregate Demand and Shifts the AD