The main reason why the aggregate demand curve slopes downward is that higher prices increases the demand for bank deposits, and hence for bank reserves.

Suppose that in October, market analysts predict that the price of platinum will fall in November. What happens in the platinum market in October, holding everything else constant?

A) The demand curve shifts to the right. B) The supply curve shifts to the right. C) The supply curve shifts to the left. D) The quantity of platinum demanded and the quantity of platinum supplied both increase.

According to Keynes' philosophy of government budgets, _____

a. chronic deficits accumulate into a national debt b. permanent surpluses are desirable c. fiscal policy focuses on maintaining an annually balanced budget d. deficits dampen aggregate demand in the short run and reduce the federal debt e. deficits are appropriate during recessions