The aggregate demand curve for a particular economy establishes a relationship between:
A) the level of total spending in the economy and the level of employment.
B) the level of planned production in the economy and the general price level.
C) the level of aggregate expenditure in the economy and the general price level.
D) the general price level and the interest rate.

Question

Quizplus · Accepted Answer

The aggregate demand curve represents the total quantity of all goods and services demanded by the economy at different price levels. Thus, it establishes a relationship between the level of aggregate expenditure in the economy and the general price level, making option C correct.

The Aggregate Demand Curve for a Particular Economy Establishes a Relationship