If autonomous consumption decreases,then
A)The AD curve will shift to the right.
B)The AD curve will shift to the left.
C)There will be a movement to the left along the AD curve.
D)The AD curve will not be affecteD.In this case,the autonomous consumption category falls,so the AD curve would decrease,thereby shifting to the left.

Question

Quizplus · Accepted Answer

Autonomous consumption is a component of aggregate demand (AD) and a decrease in autonomous consumption means that households are consuming less at every given level of income. This leads to a decrease in AD and a leftward shift of the AD curve. Therefore, choice B is the correct answer.

If Autonomous Consumption Decreases,then