What would cause the aggregate demand curve to shift to the right?
A)An increase in taxes.
B)A decrease in government spending on goods and services.
C)An increase in net tax revenues.
D)Counter-cyclical fiscal policy used to eliminate recessionary gap.

Question

Quizplus · Accepted Answer

Counter-cyclical fiscal policy used to eliminate recessionary gap involves increasing government spending and/or decreasing taxes, which will increase aggregate demand and shift the AD curve to the right. A, B, and C would all shift the AD curve to the left, indicating a decrease in aggregate demand.

What Would Cause the Aggregate Demand Curve to Shift to the Right