The AD-Curve Has a Negative Slope Since

question 14

Multiple Choice

The AD-curve has a negative slope since

• A)firms will produce less if they have to lower their prices
• B)lower prices mean higher real wages so firms can no longer afford to produce as many goods and services
• C)a decrease in the price level increases real money balances, leading to lower interest rates and increased spending
• D)lower prices drive up the demand for goods since buyers fear future market shortages
• E)lower prices increase consumer confidence, which encourages spending

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Definitions:

Panic Attack

A sudden episode of terrifying bodily symptoms such as labored breathing, choking, dizziness, tingling hands and feet, sweating, trembling, heart palpitations, and chest pain.

Medical Model

The medical model is an approach to understanding and treating mental disorders, emphasizing biological and physiological explanations and treatments.

Systematic Desensitization

A therapeutic approach designed to reduce anxiety or fear through gradual exposure to the feared object or situation while employing relaxation techniques.

Biological Therapy

A treatment approach that uses biological agents, such as antibodies or cells, to treat diseases and medical conditions.