The Downward Slope of the Aggregate Demand Curve Is Based

question 117

True/False

The downward slope of the aggregate demand curve is based on logic that as the price level rises, consumption, investment, and net exports all fall.

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Definitions:

Operating Income

Income generated from a company's ongoing, core business operations, excluding deductions of interest and taxes.

Variable Costs

Costs that vary directly with the level of production or business activity.

Income From Operations

Income From Operations is the profit realized from a business's operational activities, excluding any investment income or taxes.

Contribution Margin Ratio

The contribution margin ratio is a financial metric that shows what percentage of sales revenue is not consumed by variable costs and thus contributes to covering fixed costs.