The aggregate demand curve shows the quantity of:
A) nominal output demanded at each level of inflation.
B) real output demanded at each level of inflation.
C) output made available at each level of inflation.
D) real output demanded at each level of real interest rate.

Question

Quizplus · Accepted Answer

The aggregate demand curve shows the quantity of real output demanded at each level of inflation. It shows the relationship between the overall level of prices in the economy (measured by the inflation rate) and the quantity of real output that the economy is willing to buy (measured by real GDP).

The Aggregate Demand Curve Shows the Quantity Of