We would expect the aggregate demand curve to be

Question

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The aggregate demand curve is downward sloping because as the price level decreases, consumers' purchasing power increases, leading to an increase in consumption and investment. This results in an increase in real GDP demanded, causing a downward-sloping aggregate demand curve. Conversely, an increase in price level reduces the demand for goods and services, resulting in a decrease in real GDP demanded. This is why the aggregate demand curve is downward sloping.

We Would Expect the Aggregate Demand Curve to Be