When consumers spend all of their tax rebate checks,what takes place in the economy?
A) Aggregate demand shifts to the right.
B) Aggregate demand shifts to the left.
C) The LRAS curve shifts left.
D) Inflation decreases.

Question

Quizplus · Accepted Answer

When consumers spend all of their tax rebate checks, it increases their disposable income and therefore increases their spending, which results in an increase in aggregate demand. As a result, the aggregate demand curve shifts to the right.

When Consumers Spend All of Their Tax Rebate Checks,what Takes