Chapter 8 - Quiz Answers - Chapter 8 Quiz Answers Suppose consumption decreases at each price level As a result aggregate demand decreases and the AD

Chapter 8 - Quiz Answers - Chapter 8 Quiz Answers Suppose...

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Chapter 8 – Quiz Answers Suppose consumption decreases at each price level. As a result, aggregate demand decreases , and the AD curve shifts leftward . Greater wealth makes people more willing to spend, causing a rightward shift of the economy's AD curve. If the price level remains constant but the wage rate increases, then there will be a decrease in production and the SRAS curve will shift leftward. If aggregate quantity demanded is greater than aggregate quantity supplied at a particular price level, then A&B (consumers will bid prices upward, and a greater quantity of output will be supplied & the shortage will likely be eliminated). The AD curve shows the various amounts of real output that people are willing and able to buy at different price levels. Which of the following will not lead to a leftward shift in the SRAS curve?

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