If the price level decreases, then the aggregate expenditures schedule will shift. This translates into a
A) movement down along the aggregate demand curve.
B) shift in aggregate demand to the right.
C) shift in aggregate demand to the left.
D) movement up along the aggregate demand curve.

Question

Quizplus · Accepted Answer

A decrease in the price level results in an increase in the real value of money, which boosts consumption and investment. This is represented as a movement down along the aggregate demand curve, not a shift of the curve itself.

If the Price Level Decreases, Then the Aggregate Expenditures Schedule