Asked Nov 3, 2019

3. Briefly explain why the following would cause the Aggregate Demand curve to shift to the right(an increase), or to the left(a decrease):
 expectations that the economy will perform very well in the near future


Expert Answer

Step 1

Aggregate demand   = C + I + G + (X-M), C= consumption, I= Investment, G= Government spending, (X-M) = Net exports

As consumers expects the economy to perform very well in the near future, it...

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