A rise in the price level
A)moves the economy rightward along the aggregate demand curve
B)moves the economy leftward along the aggregate demand curve
C)shifts the aggregate demand curve to the left
D)shifts the aggregate demand curve to the right
E)is inconsistent with the other-things-constant assumption on which the aggregate demand curve is based

Question

Quizplus · Accepted Answer

According to the other-things-constant assumption on which the aggregate demand curve is based, a rise in price level will decrease the quantity demanded of goods and services, which means the economy will move leftward along the aggregate demand curve.

A Rise in the Price Level