One Reason Why the Aggregate Demand (AD)curve Slopes Downward Is

question 88

Multiple Choice

One reason why the aggregate demand (AD) curve slopes downward is that

• A)increases in the price level cause consumers to substitute foreign goods for domestic goods.
• B)when the price level falls firms must compete more when output increases.
• C)increased production results in lower production costs.
• D)when the price level falls consumers increase their saving rate.
• E)aggregate expenditure increases as the price level rises.

Identify and calculate variable and fixed components of costs using the high-low method.

Analyze the impact of changes in production volume on total costs and per unit costs.

Determine the contribution margin and calculate its ratio.

Analyze the effects of changes in sales volume and selling price on net operating income.

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