Which of the Following Explains Why the Aggregate Demand Curve

question 87

Multiple Choice

Which of the following explains why the aggregate demand curve slopes downward?

• A)If the price level increases,we feel poorer and therefore buy less.
• B)If the price level increases,we feel richer and therefore buy more.
• C)If domestic prices increase,we substitute domestic goods for imported ones.
• D)If the price of a particular good increases,we substitute away from that good.
• E)A decrease in the price of a particular good is like an increase in income and therefore we buy more.

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Definitions:

Meter Stick

A measuring stick one meter long, used for measuring lengths or distances.

Peripheral Nervous System

The portion of the nervous system that consists of nerves and ganglia outside of the brain and spinal cord.

Myelin

The fatty substance that surrounds and insulates the axons of some neurons, enhancing the speed of electrical signal transmission.

Schwann Cell

A type of glial cell that wraps around the axons of peripheral neurons to form the myelin sheath, which helps in the rapid transmission of nerve impulses.