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a leftward shift in AD can signify a decrease in consumer confidence and investment, leading to reduced overall spending. This, in turn, impacts the equilibrium
a leftward shift in AD can signify a decrease in consumer confidence and investment, leading to reduced overall spending. This, in turn, impacts the equilibrium point and results in a lower real GDP - a crucial indicator of economic health. Your focus on unemployment as an economic factor is spot-on. When consumer spending declines, businesses cut back on production, leading to reduced demand for workers and higher unemployment rates. The decrease in consumer confidence can also have a similar effect, discouraging businesses from hiring new employees
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