The intersection of the aggregate demand and aggregate supply curves determines the:
A) Productivity level in the economy
B) Shape of the aggregate demand curve
C) Per-unit cost of production in the economy
D) Equilibrium level of real domestic output and prices

Question

Quizplus · Accepted Answer

The intersection of the aggregate demand and aggregate supply curves determines the equilibrium level of real domestic output and prices. This point represents the level of output where the quantity demanded and quantity supplied are equal, resulting in a stable price level. The other options are not determined by the intersection of these curves.

The Intersection of the Aggregate Demand and Aggregate Supply Curves