Why does theaggregate demand curve slope downward? Give at least three reasonsan
ID: 1239711 • Letter: W
Question
Why does theaggregate demand curve slope downward? Give at least three reasonsand examples when addressing this question, using the Internet asresources. Identify an event that would shift the AD curve andwhich direction the AD curve willshift.Explanation / Answer
price up -> interest rates up(inflation targeting) ->aggregate demand down(Thin Keynes) Price up -> your nations products get more expencive for for agiven nominal exchange rate -> less export ->agrregate demanddown Increased government spending will shift the curve to the right
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