If the government announces a decrease in spending with an increase in taxes, which of the following would most likely occur?   a. a leftward shift of the aggregate demand curve   b. a rightward shift of the aggregate demand curve   c. an upward movement along the aggregate demand curve   d. a downward movement along the aggregate demand curve   e. no change in the aggregate demand curve as well as no movement along it

Economics:
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Chapter8: Macroeconomic Equilibrium: Aggregate Demand And Supply
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Problem 11E
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  1. If the government announces a decrease in spending with an increase in taxes, which of the following would most likely occur?
 

a.

a leftward shift of the aggregate demand curve

 

b.

a rightward shift of the aggregate demand curve

 

c.

an upward movement along the aggregate demand curve

 

d.

a downward movement along the aggregate demand curve

 

e.

no change in the aggregate demand curve as well as no movement along it

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