During the 2000s, Americans dramatically increased their personal debt. This is an example of:
A) a negative aggregate demand shock
B) a positive aggregate demand shock
C) a rightward movement along the IS curve
D) a positive aggregate supply shock
E) Not enough information is given.

Question

Quizplus · Accepted Answer

A dramatic increase in personal debt would lead to an increase in consumption spending and thus a positive aggregate demand shock.

During the 2000s, Americans Dramatically Increased Their Personal Debt