Which of the following results in the aggregate demand curve shifting rightward year after year?
A) a one- time increase in government expenditures on goods and services
B) inflation
C) a one- time tax cut
D) growth in the quantity of money

Question

Quizplus · Accepted Answer

Growth in the quantity of money leads to an increase in consumer spending, which in turn leads to an increase in aggregate demand. This effect is compounded over time, resulting in a rightward shift of the aggregate demand curve year after year. The other options (a one-time increase in government expenditures, inflation, a one-time tax cut) may also have an impact on aggregate demand, but are not necessarily guaranteed to result in a continuous rightward shift over time.

Which of the Following Results in the Aggregate Demand Curve