Which statement best characterizes what happens to the aggregate demand curve when the price level falls?
A) A fall in the price level moves the economy rightward along the aggregate demand curve.
B) A fall in the price level moves the economy leftward along the aggregate demand curve.
C) A fall in the price level shifts the aggregate demand curve to the left.
D) A fall in the price level shifts the aggregate demand curve to the right.

Question

Which statement best characterizes what happens to the aggregate demand curve when the price level falls?  
A) A fall in the price level moves the economy rightward along the aggregate demand curve. 
B) A fall in the price level moves the economy leftward along the aggregate demand curve. 
C) A fall in the price level shifts the aggregate demand curve to the left. 
D) A fall in the price level shifts the aggregate demand curve to the right.

Quizplus · Accepted Answer

A fall in the price level increases the quantity of goods and services demanded because consumers' purchasing power increases, moving the economy rightward along the aggregate demand curve.

Which Statement Best Characterizes What Happens to the Aggregate Demand