Given an aggregate supply curve,a decrease in aggregate demand will:

A) increase the real interest rate.
B) increase real GDP.
C) increase the price level.
D) decrease the real exchange rate.
E) decrease real GDP.

According to the aggregate supply and demand model, a decrease in aggregate demand will lead to a decrease in both the equilibrium price level and real GDP. As demand decreases, firms will produce less output, resulting in lower real GDP. This will lead to a decrease in incomes and thus, a decrease in consumption and investment spending. As a result, the aggregate demand curve will shift further leftward, leading to a further decrease in real GDP. Thus, the best choice for this question is (E), decrease in real GDP.