With respect to the aggregate demand curve,a tax cut will:
A) Move the economy down along the curve.
B) Move the economy up along the curve.
C) Shift the curve leftward.
D) Shift the curve rightward.

Question

Quizplus · Accepted Answer

A tax cut increases consumers' disposable income, leading to an increase in consumer spending. This increase in spending shifts the aggregate demand curve to the right, as it represents a higher level of demand at every price level.

With Respect to the Aggregate Demand Curve,a Tax Cut Will