View the step-by-step solution to:

Aggregate demand shifts right if a. taxes rise and shifts left if stock prices rise. taxes fall and shifts left if stock prices rise. taxes rise and...

Aggregate demand shifts right if


a. taxes rise and shifts left if stock prices rise.

b. taxes fall and shifts left if stock prices rise.

c. taxes rise and shifts left if stock prices fall.

d. taxes fall and shifts left if stock prices fall.


Can someone explain why D is the answer? I know that the aggregate demand curve will shift right when taxes fall but why would it shift left if stock prices fall? If stock prices fell wouldn't that give an incentive to consumers to buy more stock making the curve shift right? The answer I would choose here would be B.

Top Answer

The answer is D because when stock price falls it means that more people are willing to supply... View the full answer

Sign up to view the full answer

Other Answers

Here is the explanation for... View the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online