- in Figure 10

question 24

Multiple Choice

- In Figure 10.1,which of the following could cause a shift from AD₀ to AD_1, ceteris paribus?

• A)An increase in consumer confidence.
• B)A decrease in interest rates.
• C)A decrease in government spending on the environment.
• D)An increase in exports.

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Definitions:

Consumption Reduction

A decrease in the amount of goods and services consumed by individuals or communities, often aimed at saving resources or money.

Price Increase

An upward adjustment in the cost of goods or services, often driven by factors like inflation, increased demand, or higher production costs.

Inferior Good

An inferior good is a type of product whose demand decreases as the income of the consumer increases, in contrast to normal goods.