The aggregate demand curve would shift to the left if
A) government spending were increased.
B) net taxes were increased.
C) the money supply were increased.
D) the cost of energy were to decrease.

Question

Quizplus · Accepted Answer

An increase in net taxes would decrease disposable income and, as a result, decrease consumption, leading to a decrease in aggregate demand. A) increasing government spending would increase aggregate demand; C) increasing the money supply would increase aggregate demand; D) decreasing the cost of energy would increase supply and potentially decrease production costs, but would not directly impact aggregate demand.

The Aggregate Demand Curve Would Shift to the Left If