Aggregate demand is the relationship between the quantity of real GDP demanded and the___________
A) real wage rate
B) nominal GDP demanded
C) price level
D) money wage rate

Question

Quizplus · Accepted Answer

Aggregate demand is the total demand for goods and services in an economy at a given price level. Therefore, the relationship between the quantity of real GDP demanded and the price level is the most appropriate choice. A change in the price level will cause a movement along the aggregate demand curve, while factors such as changes in consumer confidence, government policy, or investment levels will shift the aggregate demand curve. The other choices, real and nominal wage rates and money wage rate, do not directly determine the level of aggregate demand.

Aggregate Demand Is the Relationship Between the Quantity of Real