What does the aggregate demand curve show? What factors change and what factors remain the same when there is a movement along the aggregate demand curve?
What will be an ideal response?
The aggregate demand curve shows the relationship between the quantity of real GDP demanded and the price level when other influences on expenditure plans remain the same. When there is a movement along the aggregate demand curve, the price level changes and other factors such as expectations, fiscal and monetary policy, and the world economy remain the same.
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Which of the following is not a factor in the equation of exchange?
A) Money velocity B) Money supply C) The price level D) Nominal income
Which of the following conditions does not need to be satisfied in order to practice price discrimination?
a. a perfectly elastic demand curve b. a negatively-sloped demand curve for the firm's output c. the ability to identify customers who are willing to pay more for the good d. the ability to identify customers who are not willing to pay more e. the ability to prevent resale of the good