When the domestic price level increases,exports decrease and imports increase.Other things the same,this change is illustrated by a
A)movement downward along the aggregate demand curve.
B)rightward shift of the aggregate demand curve.
C)rightward shift of the aggregate supply curve.
D)movement upward along the aggregate demand curve.
E)leftward shift of the aggregate demand curve.

Question

Quizplus · Accepted Answer

An increase in the domestic price level leads to a movement upward along the aggregate demand curve, as higher prices reduce the quantity of goods and services demanded.

When the Domestic Price Level Increases,exports Decrease and Imports Increase