Which of the following is likely to lead to a decrease in aggregate demand?
A)an increase in interest rates
B)an increase in wealth
C)an increase in national income
D)an increase in government spending on goods and services.

Question

Quizplus · Accepted Answer

An increase in interest rates will discourage borrowing and investment, which will lead to a decrease in consumer and business spending, resulting in a decrease in aggregate demand. The other choices would likely lead to an increase in aggregate demand.

Which of the Following Is Likely to Lead to a Decrease