The aggregate demand curve differs from an individual demand curve in that
A) the aggregate demand curve may not slope down while an individual demand curve must always slope down.
B) the aggregate demand curve looks at the entire circular flow of income and product, while an individual demand curve looks at one good, holding everything else constant.
C) prices change along an individual demand curve but prices are held constant along an aggregate demand curve.
D) the aggregate demand curve slopes up while an individual demand curve slopes down.

Question

Quizplus · Accepted Answer

The aggregate demand curve looks at the overall demand for all goods and services in an economy, taking into account changes in all factors such as income, prices of related goods, and consumer expectations. On the other hand, an individual demand curve looks at the demand for a single product or service while holding other factors constant. Therefore, the best answer is B.

The Aggregate Demand Curve Differs from an Individual Demand Curve