What will decrease aggregate demand (AD) within an economy? an increase in the price level an increase in deficit government spending an increase in consumet confidence an increase in business taxes

1 answer
Question:


What will decrease aggregate demand (AD) within an economy?
an increase in the price level
an increase in deficit government spending
an increase in consumet confidence
an increase in business taxes

Answers

Answer: Option 4 an increase in business taxesExplanation:When there is a increase in price level it does affect the aggregate supply curve and not the aggregate demand curve. When there is an increase of the government spending then the aggregate demand will also increase. Consumer confidence does not have any effect on the aggregate demand in the economy.As the tax increases the consumer pockets will be cut down so that will eventually cut down the consumer spending. When the consumer spending is reduced then the aggregate demand will also decrease in the economy.

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