-Refer to the figure above to answer this question.Which of the following would cause a movement from point a to point c?
A)A decrease in the price level.
B)An increase in wealth holdings.
C)An increase in government spending.
D)An increase in the interest rate.
E)An increase in foreign incomes.

Question

-Refer to the figure above to answer this question.Which of the following would cause a movement from point a to point c?
A)A decrease in the price level. 
B)An increase in wealth holdings. 
C)An increase in government spending. 
D)An increase in the interest rate. 
E)An increase in foreign incomes.

Quizplus · Accepted Answer

An increase in the interest rate typically leads to a decrease in aggregate demand, causing a movement along the aggregate demand curve from a higher output level (point a) to a lower output level (point c).

-Refer to the Figure Above to Answer This Question