One Explanation for the Negative Slope of the Aggregate Demand

question 11

Multiple Choice

One explanation for the negative slope of the aggregate demand curve is that

• A)as prices rise,nominal income falls and so does the demand for real goods and services
• B)falling prices make people feel poorer and reduce spending
• C)as prices rise,government spends less to drive the price level back down
• D)businesses increase spending when inflation is high and rising
• E)as prices rise,domestic goods become more expensive relative to foreign goods,which reduces exports

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Definitions:

Motivation

The method that starts, directs, and sustains actions aimed at achieving objectives.

Rehearsal

A cognitive process involving the repetitive review of information to be remembered, enhancing memory retention.

Unorganized Information

Data or facts that are not systematically arranged, making it difficult to process, understand, or utilize efficiently.

Memory Strategy

Techniques or activities designed to improve the ability to retain and recall information.