The aggregate expenditure curve will become steeper if
A)people become thriftier.
B)people show an increased preference for foreign-made products.
C)firms expect an increase in future profit.
D)income tax rates are lowered.
E)income tax rates are raised.

Question

Quizplus · Accepted Answer

Income tax rates are lowered means people have more disposable income, which they can spend on goods and services, increasing aggregate expenditure.

The Aggregate Expenditure Curve Will Become Steeper If