Multiple Choice
If the aggregate price level rises,holding everything constant,consumers will:
A) need more money to purchase the same basket of goods,which will lead to an increase in the demand for money,hence an increase in the interest rate and a reduction in the quantity of aggregate output demanded via a decrease in investment demand.
B) find their purchasing power has increased and will purchase more goods and services,leading to an increase in the aggregate output demanded.
C) demand less aggregate output at all price levels,resulting in a shift right of the AD curve.
D) need less money to purchase the same basket of goods,which will lead to a decrease in the demand for money,hence a decrease in the interest rate and an increase in the quantity of aggregate output demanded via an increase in investment demand.
Correct Answer:

Verified
Correct Answer:
Verified
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