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:

Percentage Of Idle Time

The proportion of time that resources remain unutilized during the production process.

Balanced Scorecard

A strategic planning and management system used to align business activities to the vision and strategy of the organization, improve internal and external communications, and monitor organizational performance against strategic goals.

Financial

Relating to money or how money is managed, including aspects such as investments, expenses, and revenue generation.

Customer

An individual or entity that purchases goods or services from another entity, forming the basis of the business's revenue.