The wealth effect,interest-rate effect,and exchange-rate effect are all explanations for
A)the slope of short-run aggregate supply.
B)the slope of long-run aggregate supply.
C)the slope of the aggregate-demand curve.
D)everything that makes the aggregate-demand curve shift.

Question

Quizplus · Accepted Answer

The wealth effect, interest-rate effect, and exchange-rate effect are all factors that can cause the aggregate-demand curve to slope downward. These effects refer to the impact that changes in consumer wealth, interest rates, and exchange rates have on consumption and net exports, which in turn affect aggregate demand.

The Wealth Effect,interest-Rate Effect,and Exchange-Rate Effect Are All Explanations for