The Aggregate Demand Curve Slopes Downward Because at Higher Price

question 212

Multiple Choice

The aggregate demand curve slopes downward because at higher price levels

• A) the purchasing power of consumers' assets declines and consumption increases.
• B) producers can get more for what they produce, and they increase production.
• C) the purchasing power of consumers' assets declines and consumption decreases.
• D) the purchasing power of consumers' assets increases and consumption increases.

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Definitions:

Balance Theory

A psychological theory suggesting that people strive for harmony and consistency in their relationships, attitudes, and beliefs, avoiding imbalance or discord.

Cognitive Consistency

A model of social cognition in which people try to reduce inconsistency among their cognitions, because they find inconsistency unpleasant.

Balance Theory

A psychological theory that suggests individuals strive for a harmonious balance in their relationships and beliefs, avoiding inconsistency among their thoughts.

Triad

In sociology, a group of three people, which provides the simplest unit for studying complex group dynamics.