Increased taxes will shift the aggregate demand curve to the _____ and _____ output demanded.
A) left; decrease
B) left; increase
C) right; increase
D) right; decrease

Question

Quizplus · Accepted Answer

Increased taxes will reduce disposable income for consumers, leading to a decrease in consumption spending, which will shift the aggregate demand curve to the left. This will result in a decrease in the output demanded.

Increased Taxes Will Shift the Aggregate Demand Curve to the _____