If individuals became more worried about the future and deci

If individuals became more worried about the future and decide to increase the amount they hold in cash relative to deposits the money multiplier (MM) would__and the aggregate demand (AD) curve would shift decrease; in. decrease; out. increase in. increase; out. None of the answers is correct.

Solution

As the people are holding more money in hand and less money as deposits the money multiplier will increase and the aggregate demand curve will shift to the right i.e. Out.

The answer is \"Increase; Out\".