Suppose the wealth of consumers increases substantially.How would this be reflected in the aggregate demand curve?
A) The aggregate demand curve would shift outward.
B) The aggregate demand curve would NOT change.
C) The aggregate demand curve would shift inward.
D) The aggregate demand curve would become vertical.

Question

Suppose the wealth of consumers increases substantially.How would this be reflected in the aggregate demand curve?  
A) The aggregate demand curve would shift outward. 
B) The aggregate demand curve would NOT change. 
C) The aggregate demand curve would shift inward. 
D) The aggregate demand curve would become vertical.

Quizplus · Accepted Answer

An increase in wealth would lead to an increase in consumer spending, leading to an increase in overall demand for goods and services. This would cause the aggregate demand curve to shift outward, representing a higher level of demand at every price level.

Suppose the Wealth of Consumers Increases Substantially