Other things equal, an increase in consumer wealth will:
A) Increase aggregate supply
B) Increase aggregate demand
C) Reduce the price level
D) Reduce the money supply

Question

Quizplus · Accepted Answer

An increase in consumer wealth will increase their purchasing power, leading to an increase in demand for goods and services. This increase in demand will lead to an increase in aggregate demand, shifting the AD curve to the right.

Other Things Equal, an Increase in Consumer Wealth Will