Suppose Households Become More Future-Oriented and Decide to Save More

question 139

Multiple Choice

Suppose households become more future-oriented and decide to save more at each income level. All other things unchanged, this will

• A) shift the aggregate demand curve to the right.
• B) shift the aggregate demand curve to the left.
• C) not affect aggregate but rather aggregate supply because firms will now produce less.
• D) shift both the aggregate demand curve and the aggregate supply curve to the left.

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