One Reason That the Aggregate Demand Curve Has a Negative

question 25

Multiple Choice

One reason that the aggregate demand curve has a negative slope is because

• A) The premise of the question is wrong because the aggregate demand curve has a positive slope.
• B) people buy fewer goods and save more when the price level rises because their real wealth decreases.
• C) firms produce more when the price rises.
• D) people earn more money when output rises.

---

Definitions:

Deseasonalizing

The process of removing the seasonal components of data to analyze and forecast trends more accurately.

Regression Analysis

is a statistical method for investigating and modeling the relationship between variables.

Dependent Variable

The factor in a model or experiment predicted to vary as a result of modifications in the independent variables.

Seasonal Index

A measure that quantifies the predictable fluctuation in activity or values according to the season or time of the year.