The aggregate demand curve is negatively sloped due to: a the elasticity effect of an aggregate price level change b the fiscal

Question

3 years ago

5

The aggregate demand curve is negatively sloped due to: a the elasticity effect of an aggregate price level change b the fiscal

policy effect c the substitution effect of the aggregate price level change d the wealth effect of an aggregate price level change

Business

1 answer:

balandron [24] · Answer 1 · 2022-06-06T19:55:16+03:00

Answer:

d. the wealth effect of an aggregate price level change

Explanation:

The aggregate demand curve is negatively sloped due to <u>the wealth effect of an aggregate price level change</u>. The reason is that rise in the aggregate price decreases the purchasing power of the individual and thus, decreases in aggregate demand increases the purchasing power of the individual.