Which change would shift the aggregate demand curve

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The economy has been sluggish, so in an effort to increase output in the short run, government officials have decided to cut taxes. They are considering two possible temporary tax cuts of equal size in terms of lost revenue.

The first would reduce the taxes on people with incomes above the median for one year. The second would cut taxes on people with incomes below the median for one year. Which change would shift the aggregate demand curve further to the right? Why?

Reference no: EM131223310

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