In 2016, worries about the stock market caused consumer confidence in Asia to fall. Ceteris paribus, which of the graphs shows the correct effect on aggregate demand?

A)Figure A
B)Figure B
C)Figure C
D)Figure D

Question

In 2016, worries about the stock market caused consumer confidence in Asia to fall. Ceteris paribus, which of the graphs shows the correct effect on aggregate demand?

A)Figure A 
B)Figure B 
C)Figure C 
D)Figure D

Quizplus · Accepted Answer

A decrease in consumer confidence would shift the aggregate demand curve to the left (decrease), as shown in Figure B.

In 2016, Worries About the Stock Market Caused Consumer Confidence