In Order for the Aggregate Demand (AD) Curve to Be

question 48

Multiple Choice

In order for the aggregate demand (AD) curve to be downward-sloping,

• A)there has to be an inverse relationship between the real interest rate and real GDP and a positive relationship between inflation and the real interest rate.
• B)there has to be a positive relationship between the real interest rate and real GDP and a negative relationship between inflation and the real interest rate.
• C)there has to be an inverse relationship between the real interest rate and real GDP and an inverse relationship between inflation and the real interest rate.
• D)there has to be a positive relationship between the real interest rate and real GDP and a positive relationship between inflation and the real interest rate.
• E)there has to be an inverse relationship between the real interest rate and real GDP but there cannot be a relationship between inflation and the real interest rate.

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