A rise in consumer confidence, with other factors unchanged, most directly causes
Correct answer: B. A rightward shift of aggregate demand
- A. A movement down the aggregate demand curve
- B. A rightward shift of aggregate demand
- C. A leftward shift of short-run aggregate supply
- D. A movement up the aggregate supply curve
Explanation
Greater consumer confidence usually raises planned consumption at each price level. This increases aggregate demand and shifts its curve to the right, rather than causing movement along the curve.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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