Why Does the Aggregate Demand Curve Slope Downward

question 96

Multiple Choice

Why does the aggregate demand curve slope downward?  

• A) because, at a higher price level, fewer goods and services are available 
• B) because the periods when the price level is rising are usually times of swift declines in economic activity 
• C) because households feel poorer when average prices increase 
• D) because if the Canadian price level rises, foreigners will buy more Canadian goods, leaving fewer Canadian goods for domestic consumers

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Definitions:

Liquid

A state of matter characterized by a definite volume but no fixed shape, conforming to the shape of its container.

Direct Current

An electric current that flows in a single direction steadily, commonly used in batteries and DC power supplies.

Omnidirectional

Pertaining to radiation or reception of signals uniformly in all directions, often used in the context of antennas or microphone patterns.

Unidirectional

Moving in only one direction.