When we draw the aggregate demand curve, _______ should be on the x- axis and _______ should be on the y- axis.
A) real GDP; inflation
B) real GDP; the price level
C) quantity; price
D) price; quantity

Question

Quizplus · Accepted Answer

The x-axis of the aggregate demand curve represents real GDP, while the y-axis represents the price level. This is because aggregate demand shows the total quantity of goods and services demanded in an economy at different price levels. Real GDP represents the level of output and income in the economy, while the price level represents the general price level of goods and services. Therefore, choice B is the correct answer.

When We Draw the Aggregate Demand Curve, _______ Should Be