One Explanation for the Slope of the Aggregate Demand Curve

question 20

Multiple Choice

One explanation for the slope of the aggregate demand curve is that:

• A)nominal income falls and so does the demand for goods and services as prices rise.
• B)falling prices make people feel poorer and reduce spending.
• C)the government spends less to drive the price level back to normal as prices rise.
• D)businesses increase spending when inflation is high and rising.
• E)domestic goods become more expensive relative to foreign goods when prices rise,reducing exports.

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Definitions:

Shipbuilding Industry

A sector of the economy that designs, constructs, and repairs ships, crucial for transportation, military, and trade purposes.

Task System

A labor system used on plantations, particularly in the cultivation of rice and cotton, where enslaved people were assigned specific tasks to complete each day, as opposed to working from sunrise to sunset.

Slave

A person who is the legal property of another and is forced to obey them.

Quota

A fixed share or allocation of something, often applied to trade limitations, immigration controls, or production targets.