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Social Science2. Briefly explain why the following would cause the Aggregate Demand curve to shift to the right(an increase), or to the left(a decrease):an increase in interest rates
2. Briefly explain why the following would cause the Aggregate Demand curve to shift to the right(an increase), or to the left(a decrease):
an increase in interest rates
Expert Answer
Aggregate demand = C + I + G + (X-M), C= consumption, I= Investment, G= Government spending, (X-M) = Net exports
The increase in interest rates will lead to an increase in savings as consumers receive greater...
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