An increase in investment spending can be expected to shift the:
A)aggregate expenditures curve downward and the aggregate demand curve leftward.
B)aggregate expenditures curve upward and the aggregate demand curve leftward.
C)aggregate expenditures curve downward and the aggregate demand curve rightward.
D)aggregate expenditures curve upward and the aggregate demand curve rightward.

Question

Quizplus · Accepted Answer

An increase in investment spending will shift the aggregate expenditures curve upward, as it contributes to higher total spending in the economy. This shift will also result in a rightward shift in the aggregate demand curve, as higher total spending leads to an increase in overall demand for goods and services in the economy.

An Increase in Investment Spending Can Be Expected to Shift