Frugal consumers suppose household become nervous about the, Business Economics

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Frugal consumers suppose household become nervous about the

Frugal Consumers Suppose household become nervous about the future and decide to increase their savings and decrease their consumption spending.

1. How will this shift the aggregate demand curve? Use the Keynesian aggregate supply curve to figure out what will happen to prices and output in the short run. (Draw a graph to explain the shift)

2. Use the classical aggregate supply curve to determine what will happen to prices and output in the long run. (Draw a graph to explain the shift)

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Business Economics: Frugal consumers suppose household become nervous about the

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