One of the Reasons Why the Aggregate Demand (AD)curve Slopes

question 25

Multiple Choice

One of the reasons why the aggregate demand (AD) curve slopes downward is that

• A)aggregate expenditure increases as the price level rises.
• B)increases in the price level cause consumers to substitute foreign goods for domestic goods.
• C)increased production results in lower production costs.
• D)when the price level falls firms must be more competitive when output increases.
• E)when the price level falls consumers increase their saving rate.

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Definitions:

Negative Stereotype

A fixed, overgeneralized belief about a particular group or class of people that is unfavorable or harmful.

Out-Group

A social group toward which an individual feels a sense of competition or opposition, as opposed to an "in-group," which elicits feelings of loyalty and belonging.

Equal Pay Act

A labor law that prohibits gender-based wage discrimination, mandating equal pay for equal work performed by men and women.

Manufacturing Facilities

Places designed and equipped for the manufacturing of goods and products.