The aggregate demand curve would NOT shift to the left as a result of:
A) a fall in consumers' wealth.
B) a decrease in the amount of money in circulation.
C) more pessimistic consumer expectations.
D) lower labour productivity.

Question

Quizplus · Accepted Answer

A decrease in labour productivity would result in higher production costs and lower supply, which would shift the supply curve to the left, but it would not directly affect the aggregate demand curve. A fall in consumers' wealth, a decrease in the amount of money in circulation, and more pessimistic consumer expectations would all result in lower spending, which would shift the aggregate demand curve to the left.

The Aggregate Demand Curve Would NOT Shift to the Left