The aggregate demand curve shows the__________ relationship between the price level and________
A) positive; the quantity of real GDP demanded
B) negative; aggregate labor demanded
C) negative; the quantity of real GDP demanded
D) positive; aggregate labor demand

Question

Quizplus · Accepted Answer

The aggregate demand curve shows a negative relationship between the price level and the quantity of real GDP demanded. This is because as the price level increases, the purchasing power of consumers is reduced, leading to a decrease in the quantity of goods and services demanded. Conversely, as the price level decreases, the purchasing power increases, leading to an increase in the quantity of goods and services demanded.

The Aggregate Demand Curve Shows The__________ Relationship Between the Price