Which of the Following Helps Explain Why the AD Curve

question 23

Multiple Choice

Which of the following helps explain why the AD curve is downward sloping?

• A) If consumers and businesses expect higher prices in the future, they will purchase more today, increasing investment and consumption expenditure.
• B) When the price level falls, the real value of wealth rises, so people save less and consume more.
• C) If the exchange rate falls and the price level does not change, exports increase and imports decrease.
• D) None of the above answers is correct.

---

Definitions:

Scabies

A skin infestation by the mite Sarcoptes scabiei, causing intense itching and rash.

Trichomoniasis

A sexually transmitted infection caused by the parasite Trichomonas vaginalis, characterized by itching, discharge, and discomfort.

Cystitis

Inflammation of the bladder, usually caused by a bacterial infection, leading to symptoms like painful urination and an urgent need to urinate.

Bladder Infection

An infection in the bladder, often caused by bacteria, leading to symptoms like pain during urination and the urge to urinate frequently.