A decrease in interest rates will immediately shift
A)aggregate demand to the right.
B)aggregate demand to the left.
C)aggregate supply to the right.
D)aggregate supply to the left.

Question

Quizplus · Accepted Answer

A decrease in interest rates will increase the incentive for firms and households to borrow, leading to an increase in investment and consumption spending. This, in turn, will increase aggregate demand, shifting it to the right.

A Decrease in Interest Rates Will Immediately Shift