In the aggregate demand and aggregate supply model, when does the aggregate quantity of goods demanded decrease?
A) when real wealth increases
B) when the interest rate falls
C) when the dollar depreciates
D) when stock prices fall

Question

Quizplus · Accepted Answer

When stock prices fall, people feel less wealthy and may therefore spend less money, which causes a decrease in the aggregate quantity of goods demanded.

In the Aggregate Demand and Aggregate Supply Model, When Does