When the price level goes down,the aggregate demand curve
A)shifts to the right.
B)remains unchanged but there is a movement along the curve.
C)continues to slope downward.
D)causes the long-run aggregate supply to shift to the left.

Question

Quizplus · Accepted Answer

When the price level goes down, the purchasing power of individuals and firms increases, leading to an increase in consumption, investment, and net exports, which causes a movement along the aggregate demand curve, but the curve itself does not shift. Therefore, the correct answer is B.

When the Price Level Goes Down,the Aggregate Demand Curve