Increased uncertainty will cause the economy's AD curve to:
A) shift inward.
B) shift outward.
C) become steeper.
D) become flatter.

Question

Quizplus · Accepted Answer

Increased uncertainty leads to a decrease in consumer and business confidence, which results in a decrease in consumption and investment spending. This will cause the economy's AD curve to shift inward, reflecting a decrease in aggregate demand.

Increased Uncertainty Will Cause the Economy's AD Curve To