When the U.S.aggregate demand curve shifted to the left during the Great Depression,
A) the price level increased.
B) the price level decreased.
C) real gross domestic product (GDP)increased.
D) expected income increased.
E) tax rates decreased.

Question

Quizplus · Accepted Answer

When the aggregate demand curve shifts to the left, there is a decrease in both output and prices. This was observed during the Great Depression, where there was a contraction in the economy leading to a decrease in spending and a leftward shift in the AD curve, resulting in a decrease in prices.