In the aggregate demand and aggregate supply model,which pair of simultaneous events causes a decrease in output and employment?
A) lower demand and lower supply
B) lower demand and higher supply
C) higher demand and higher supply
D) higher demand and lower supply

Question

Quizplus · Accepted Answer

A simultaneous decrease in both aggregate demand and aggregate supply will lead to a decrease in output and employment, as there is less overall economic activity and fewer goods and services being produced and consumed.

In the Aggregate Demand and Aggregate Supply Model,which Pair of Simultaneous