What Does the Slope of the Aggregate Demand Curve Indicate

question 70

Multiple Choice

What does the slope of the aggregate demand curve indicate?

• A)That a decrease in the price level leads to a higher level of aggregate spending.
• B)That a decrease in the price level leads to a higher level of aggregate supply.
• C)That a decrease in the price level leads to a lower level of aggregate spending.
• D)That an increase in the price level leads to a higher level of aggregate spending.

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Definitions:

Average Revenue

The revenue generated per unit of output sold, calculated by dividing total revenue by the number of units sold.

Marginal Revenue

The additional income earned from selling one more unit of a product or service.

Marginal Revenue

The additional income gained from selling one more unit of a good or service.

Average Revenue

The total revenue received by a firm from selling its products divided by the total quantity of the product sold, essentially the average price per unit sold.