As the interest rate decreases, the planned aggregate expenditure curve shifts downward.

Name: As the interest rate decreases, the planned aggregate expenditure curve shifts downward.
Brand: Quizplus
Rating: 4.8 (29 reviews)

Question

Quizplus · Accepted Answer

As the interest rate decreases, it typically makes borrowing cheaper, which can lead to increased investment and consumption. This increase in investment and consumption would shift the planned aggregate expenditure curve upward, not downward.

As the Interest Rate Decreases, the Planned Aggregate Expenditure Curve