Which of the Following Decreases Aggregate Demand and Shifts the AD

question 119

Multiple Choice

Which of the following decreases aggregate demand and shifts the AD curve leftward?

• A)a tax cut
• B)an interest rate hike
• C)an increase in quantity of money
• D)an increase in government expenditures on goods and services
• E)a decrease in potential GDP

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Definitions:

Capital Markets

Financial markets where long-term debt or equity-backed securities are bought and sold.

Short-Term Debt

Debt obligations scheduled for repayment within one year.

Municipal Bonds

Debt securities issued by states, cities, counties, and other governmental entities to finance public projects, offering tax-exempt interest payments to investors.

Long-Term Debt

Borrowings that are due to be repaid more than one year in the future, often used for significant investments in the business.