The aggregate demand curve shows:
A) that people are willing to buy more goods and services at a lower average price level.
B) an increase in average price level.
C) that people are willing to buy less goods and services at a lower average price level.
D) supply is lagging behind demand.

Question

Quizplus · Accepted Answer

The aggregate demand curve shows that as the average price level decreases, people are willing to buy more goods and services. This is because lower prices increase consumer purchasing power, making it more affordable to buy more goods and services. As prices rise, aggregate demand decreases, as people are less willing to purchase goods and services at higher prices. Therefore, the downward slope of the aggregate demand curve reflects the inverse relationship between price levels and the quantity of goods and services demanded.

The Aggregate Demand Curve Shows