A Reduction in Government Transfers _____, Therefore Shifting the Aggregate

Multiple Choice

A reduction in government transfers _____, therefore shifting the aggregate demand curve to the _____.

A) increases labor costs to companies, increasing investment; left
B) decreases government purchases of goods and services, decreasing consumption; right
C) increases the marginal propensity to save, decreasing consumption; right
D) decreases disposable income and consumption; left