The quantity of real GDP demanded equals $12.2 billion when the price level is 90. If the price level rises to 95, the quantity of real GDP demanded equals
A)more than $12.2 billion.
B)$12.2 billion.
C)less than $12.2 billion.
D)More information is needed to determine if the quantity of real GDP demanded increases, decreases or does not change.

Question

Quizplus · Accepted Answer

When the price level rises, the quantity of real GDP demanded typically decreases due to the inverse relationship between price level and quantity demanded, known as the aggregate demand curve.

The Quantity of Real GDP Demanded Equals $12