A leftward shift in the aggregate demand (AD)curve could result from a rise in
A)autonomous exports.
B)autonomous government purchases.
C)government transfer payments to households.
D)autonomous desired savings.
E)desired investment.

Question

Quizplus · Accepted Answer

A leftward shift in the AD curve means that at any given price level, there is a lower level of aggregate demand. This could happen if consumers decide to save more (increase their desired savings). When desired savings increase, less money is being spent on consumption goods and services, which leads to a decrease in aggregate demand.

A Leftward Shift in the Aggregate Demand (AD)curve Could Result