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

Quizplus · Accepted Answer

A decrease in the price level results in an increase in the quantity of goods and services demanded, which is represented by a movement down and to the right along the aggregate demand curve, not a shift of the curve itself.

How Will a Decrease in the Price Level Affect the Aggregate