The aggregate demand curve:
A)is upward sloping because a higher price level is necessary to make production profitable as production costs rise.
B)is downward sloping because production costs decline as real output increases?
C)shows the amount of expenditures required to induce the production of each possible level of real output.
D)shows the amount of real output which will be purchased at each possible price level.

Question

Quizplus · Accepted Answer

The aggregate demand curve shows the amount of real output which will be purchased at each possible price level. It represents the total amount of goods and services that buyers in an economy are willing and able to purchase at different price levels. As the price level increases, the quantity demanded of real output decreases, which results in a downward sloping aggregate demand curve.

The Aggregate Demand Curve