The aggregate demand curve slopes downward because at higher price level
A)the purchasing power of consumers' assets declines and consumption increases.
B)producers can get more for what they produce,and they increase production.
C)the purchasing power of consumers' assets declines and consumption decreases.
D)the purchasing power of consumers' assets increases and consumption increases.

Question

Quizplus · Accepted Answer

As the price level increases, the purchasing power of consumers' assets declines, meaning that they are able to purchase fewer goods and services with their income. This leads to a decrease in overall consumption, as consumers are less willing and able to spend.

The Aggregate Demand Curve Slopes Downward Because at Higher Price