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The aggregate demand curve is negatively sloped in part because of the impact of the flexibility of nominal wages and salaries. a changing exchange rate on potential output. the stickness of nominal w

The aggregate demand curve is negatively sloped in part because of the impact of the flexibility of nominal wages and salaries. a changing exchange rate on potential output. the stickness of nominal wages and salaries. the wealth effect on consumption. The aggregate demand curve slopes: downward for the same reasons that an ordinary demand curve does. downward In part because when the pace level falls, the real wealth of the public falls, and this induces people to upward, unlike an ordinary demand curve. downward in part because as the price level falls, the ability of households and firms to borrow cheaply increases. Figure: Shift of the Aggregate Demand Curve (Figure; Shift of the Aggregate Demand Curve) Look at the figure Shift of the Aggregate Demand Curve. A movement from a decrease in government spending, increases in personal income taxes, an increase in government spending, a decrease in consumer wealth. In the long run. changes in the aggregate price level will be accompanied by opposite less than more than equal

The aggregate demand curve is negatively sloped in

Jul 03 2021 View more View Less

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