When the price level rises and U.S.goods become relatively more expensive than foreign goods,there will be a(n)
A) rightward shift of the aggregate demand curve.
B) leftward shift of the aggregate demand curve.
C) upward movement along the aggregate demand curve.
D) downward movement along the aggregate demand curve.
E) downward movement along the aggregate supply curve.

Question

Quizplus · Accepted Answer

When the price level rises, U.S. goods become more expensive relative to foreign goods, leading to a decrease in the quantity of U.S. goods demanded. This results in an upward movement along the aggregate demand curve, not a shift of the curve itself.

When the Price Level Rises and U