The Relationship Between the Aggregate Demand Curve and the Aggregate

question 278

Multiple Choice

The relationship between the aggregate demand curve and the aggregate expenditures model is derived from the fact that

• A) a decrease in the price level shifts the aggregate expenditures schedule downward and decreases equilibrium GDP.
• B) a decrease in the price level shifts the aggregate expenditures schedule upward and increases equilibrium GDP.
• C) an increase in the price level shifts the aggregate expenditures schedule upward and increases equilibrium GDP.
• D) an increase in the price level shifts the aggregate expenditures schedule downward and increases equilibrium GDP.

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