Figure 24-1 -Refer to Figure 24-1. Ceteris paribus, a decrease in personal income taxes would be represented by a movement from A) AD₁ to AD₂. B) AD₂ to AD₁. C) point A to point B. D) point B to point A.

Question

Quizplus · Accepted Answer

A decrease in personal income taxes increases disposable income, leading to higher consumer spending, which shifts the aggregate demand curve to the right from AD1 to AD2.

Figure 24-1 -Refer to Figure 24-1. Ceteris Paribus, a Decrease in Personal