Step One: Explain what the aggregate demand (AD) curve and aggregate supply (AS) curves are and what each one consists of. For example, one of the components of the AD curve is consumer spending.

Step Two: Identify which curve will be affected by the following phenomena (AD Curve or AS Curve) and if it will shift up or down.

a. Increase in government spending.

b. Decrease in consumer spending.

c. Increase in the price of inputs to produce goods and services.

d. Decrease in exports to foreign countries

e. Increased income taxes