The Central Bank of Wiknam increases the money supply at the same time the Parliament of Wiknam passes a new investment tax credit.Which of these policies shift aggregate demand to the right?
A)both the money supply increase and the investment tax credit
B)the money supply increase but not the investment tax credit
C)the investment tax credit but not the money supply increase
D)neither the investment tax credit nor the money supply increase

Question

Quizplus · Accepted Answer

Both the increase in money supply and the investment tax credit would increase spending and investment, shifting the aggregate demand curve to the right.

The Central Bank of Wiknam Increases the Money Supply at the Same