How will a decrease in the price level affect the aggregate demand curve?
A) It will shift the aggregate demand curve to the right.
B) It will shift the aggregate demand curve to the left.
C) It will result in a movement upward along the aggregate demand curve.
D) It will result in a movement downward along the aggregate demand curve.

Question

How will a decrease in the price level affect the aggregate demand curve?  
A) It will shift the aggregate demand curve to the right. 
B) It will shift the aggregate demand curve to the left. 
C) It will result in a movement upward along the aggregate demand curve. 
D) It will result in a movement downward along the aggregate demand curve.

Quizplus · Accepted Answer

A decrease in the price level does not shift the aggregate demand curve; instead, it results in a movement downward along the curve because it increases the quantity of goods and services demanded.

How Will a Decrease in the Price Level Affect the Aggregate