When the Price Level Falls

question 139

Multiple Choice

When the price level falls

• A)aggregate demand shifts to the left.
• B)all prices of individual goods and services decrease.
• C)aggregate demand shifts to the right.
• D)aggregate quantity demanded increases.
• E)the interest rate will increase.

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Definitions:

Trading Partner

An entity or country that engages in commerce or trade with another, often under agreed terms or through treaties.

Held Up

Delayed or stopped by something or someone, causing a pause in progress or movement.

Average Variable Costs

The total variable costs (costs that change with output level) divided by the quantity of output produced.

Average Costs

The total cost of production divided by the number of goods produced, a measure of cost efficiency.