Lecture 22 - Aggregate Demand and Supply

Question 1

Aggregate Demand

What does the AGGREGATE DEMAND CURVE show?

Answer 1

The relationship between the aggregate price level and the quantity of aggregate output demanded by households, businesses, the government, and the rest of the world.

Question 2

Aggregate Demand
The AD curve is ________ sloping.

Is there an inverse between aggregate price level and aggregate output demanded.

Answer 2

• Downwards

YES

Question 3

Aggregate Demand

A movement down the AD curve leads to a ______ aggregate price level and _____ aggregate output.

Answer 3

Lower

Higher