The Aggregate Demand Curve Slopes Downward Because

question 104

Multiple Choice

The aggregate demand curve slopes downward because

• A) as price rises,consumers substitute cheaper goods for more expensive goods.
• B) all demand curves slope downward.
• C) a higher price level increases purchasing power.
• D) a higher price level increases exports.
• E) a higher price level reduces wealth.

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Definitions:

Retained Earnings

Profits that a company has decided to keep and reinvest in the business rather than distribute to shareholders.

Common Dividend Payable

A liability on the balance sheet representing the amount of dividends declared by a company's board of directors to be distributed to common shareholders.

Stock Split

A corporate action where a company divides its existing stock into multiple shares to boost the liquidity of the shares, without changing the market capitalization.

Percent Of Ownership

The portion of a company or asset that an individual or entity owns, typically expressed as a percentage.