Asked by Jacob Beyers on Jun 15, 2024
Verified
_____ varies along a given aggregate demand curve.
A) The nominal interest rate in the domestic country
B) The exchange rate between the domestic currency and a foreign currency
C) The aggregate supply in a foreign country
D) The price level in the domestic country
E) The prices of resources used in production
Aggregate Demand Curve
A visual diagram that illustrates the connection between the total price level within an economy and the aggregate demand for products and services at that specific price level.
Price Level
The median price level across all goods and services offered in the economic landscape.
- Assess the consequences of price level adjustments on aggregate demand and aggregate supply.
Verified Answer
JL
Jersey LegendsJun 17, 2024
Final Answer :
D
Explanation :
Along a given aggregate demand curve, the only variable that varies is the price level in the domestic country. The nominal interest rate in the domestic country (A) and the exchange rate between the domestic currency and foreign currency (B) are both determined by other factors such as monetary policy and international trade. The aggregate supply in a foreign country (C) and the prices of resources used in production (E) are not directly related to the aggregate demand curve.
Learning Objectives
- Assess the consequences of price level adjustments on aggregate demand and aggregate supply.