How Does Aggregate Demand Curve (AD) Differ from an Individual

question 294

Multiple Choice

How does aggregate demand curve (AD) differ from an individual demand curve (D) ?

• A) AD is generally vertical while D is usually downward sloping.
• B) D represents the price-quantity relationship for a single good or service while AD looks at the entire economic system.
• C) Look for D in macroeconomic analyses and for AD in microeconomics.
• D) AD is generally a downward sloping curve while D usually slopes upward.

---

Definitions:

Tariffs

Government levies on goods and services brought into the country, frequently employed to safeguard local industries against overseas rivals.

Absolute Advantage

The ability of an entity to produce a good or service more efficiently than its competitors, using fewer resources.

Textiles

Materials made from fibers, filaments, threads, or yarns, typically used in the production of fabrics and cloth.

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost compared to others.