A movement along the aggregate demand curve is caused by a(n):
A) change in the aggregate price level.
B) increase in consumer spending.
C) reduction in taxes.
D) reduction in government spending.

Question

Quizplus · Accepted Answer

According to the basic AD-AS model, a movement along the aggregate demand curve is caused by a change in the aggregate price level. This means that if the price level changes, the quantity of goods and services demanded will also change, resulting in a movement along the AD curve. Changes in consumer spending, taxes, and government spending can shift the AD curve, but they would not cause a movement along the curve.

A Movement Along the Aggregate Demand Curve Is Caused by A(n)