What would cause the aggregate demand curve shift upward?
1 Answer
Aug 26, 2015
An increase in (i) autonomous expenditure, (ii) private investment expenditure and (iii) Government expenditure will shift the Aggregate Demand curve to shift upwards.
Explanation:
Look at the graph. C+ I + G is the aggregate demand curve.
A is the autonomous consumption. Since we have assumed stable consumption function. An increase in any one of these factors i.e., A, I and G will cause the aggregate curve to shift upwards.