Which of the following will shift the aggregate demand curve to the left,ceteris paribus?
A) An increase in interest rates
B) An increase in disposable income
C) An increase in expected profits for firms
D) An increase in net exports

Question

Quizplus · Accepted Answer

An increase in interest rates will make borrowing more expensive, leading to decreased consumption and investment spending, reducing aggregate demand and shifting the AD curve to the left.

Note: Choices B, C and D would all shift the aggregate demand curve to the right.

Which of the Following Will Shift the Aggregate Demand Curve