Faster growth rates of a nation's major trading partner combined with an increase in the nation's stock market wealth would:
A)shift its aggregate demand curve to the right.
B)shift its aggregate demand curve to the left.
C)cause its aggregate price level to fall.
D)increase the slope of its aggregate demand curve
E)decrease the slope of its aggregate demand curve.

Question

Quizplus · Accepted Answer

Faster growth rates of a nation's major trading partner will increase the demand for the nation's exports, leading to an increase in the country's aggregate demand. Additionally, an increase in the nation's stock market wealth will lead to an increase in consumer spending, which will also increase the country's aggregate demand. Therefore, the aggregate demand curve would shift to the right.

Faster Growth Rates of a Nation's Major Trading Partner Combined