In a Graph of the Aggregate Demand Curve,an Increase in Investment

question 26

Multiple Choice

In a graph of the aggregate demand curve,an increase in investment by businesses is represented by a:

• A) Movement down the curve.
• B) Movement up the curve.
• C) Rightward shift of the curve.
• D) Leftward shift of the curve.

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Definitions:

Quantity Demanded

The total amount of a product that consumers are willing and able to purchase at a given price.

Linear Demand Curve

A graphical representation showing a straight-line relationship between the price of a good and the quantity demanded, indicating a constant change in demand in response to price changes.

Elasticity

A gauge of the reaction in the amount of a product desired when its price varies.

Relatively Elastic

Describes a situation where the quantity demanded of a good or service greatly changes in response to changes in its price.