The downward slope of the aggregate demand curve shows that
A) an increase in aggregate demand reduces the long-run aggregate supply.
B) an increase in aggregate demand increases the long-run aggregate supply.
C) a higher price level will cause planned purchase rates for final goods and services to be higher.
D) a lower price level will cause planned purchase rates for final goods and services to be higher.

Question

Quizplus · Accepted Answer

The downward slope of the aggregate demand curve indicates that as the price level decreases, the quantity of goods and services demanded increases, hence a lower price level leads to higher planned purchase rates.

The Downward Slope of the Aggregate Demand Curve Shows That