One of the reasons why the AD curve slopes downward is that as the
A) price level rises,purchasing power rises.
B) price level falls,purchasing power rises.
C) nation's income level rises,purchasing power rises.
D) nation's income level rises,purchasing power falls.
E) This is a trick question,because the AD curve is upward sloping.

Question

Quizplus · Accepted Answer

As the price level falls, purchasing power rises, which leads to an increase in the quantity of goods and services demanded, resulting in a downward sloping AD curve.

One of the Reasons Why the AD Curve Slopes Downward