When the aggregate demand curve shifts rightward, the price level ________ and the unemployment rate ________.
A) decreases; decreases
B) increases; decreases
C) decreases; increases
D) increases; increases
E) does not change; does not change

Question

Quizplus · Accepted Answer

When the aggregate demand curve shifts rightward, it indicates an increase in the total demand for goods and services in an economy. This typically leads to an increase in the price level due to higher demand, and a decrease in the unemployment rate as firms hire more workers to meet the increased demand.

When the Aggregate Demand Curve Shifts Rightward, the Price Level