Which of the following will shift the aggregate demand (ADI)curve to the left?
A) Income taxes are raised.
B) The government increases spending on education.
C) Consumers become optimistic about the future.
D) A new technology is developed that will increase profits.
E) Foreign economies boom,increasing their demand for domestic exports.

Question

Quizplus · Accepted Answer

When income taxes are raised, consumers have less disposable income, leading to lower consumption expenditure, and a decrease in ADI, causing the ADI curve to shift to the left.

Which of the Following Will Shift the Aggregate Demand (ADI)curve