Other things constant, a decrease in aggregate demand will
A) lead to a decrease in the demand for resources.
B) cause an increase in the general level of prices.
C) result in higher nominal wage rates.
D) reduce the rate of unemployment.

Question

Quizplus · Accepted Answer

A decrease in aggregate demand leads to a decrease in the demand for resources because businesses will produce less, requiring fewer inputs.

Other Things Constant, a Decrease in Aggregate Demand Will