What effect does an increase in consumer confidence have on the aggregate demand curve?

When consumer confidence increases, people feel more optimistic about their financial future. This usually means they are more willing to spend money on goods and services, which leads to a rise in overall demand in the economy. As demand increases, businesses may produce more to meet this demand, shifting the aggregate demand curve to the right. For example, if many families decide to buy new cars because they feel secure in their jobs, this increased spending will boost demand for cars and related products. Overall, higher consumer confidence can lead to economic growth as more money circulates in the market.