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1. Wealth effect: Price down means consumers are wealthier than if the price was higher, so they buy more.
2. Interest rate effect: As price goes down, people save more money. This increases the supply of money for loans, which in turn decreases their cost, which in turn drives up investment spending (GDP = C + I + G + NX, remember, consumption + investment + government spending + net exports).
3. Because the interest rate is lower as price goes down, investors will be more likely to invest in other countries (which will be more likely to have relatively higher interest rates), which drives up the NX part of the equation.
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Why Demand Curve slopes downward from left to right?
why demand curve slopes downward from left to the right
Why demand curve slopes downward?
Demand curve is slope downward because of inverse relationship between price and quantity.
As you move from left to right the aggregate demand curve?
slopes downward
Why does a demand curve slope downward left to right?
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
Characteristics of production possibility curve?
It slopes downward towards right:this shows that we will have to reduce the production of one commodity to increase the production of the another commodity.
Why Demand Curve slopes downward from left to right?
why demand curve slopes downward from left to the right
Why does a production possibility curve have a downward sloping curve?
PPC curve slopes downward for the efficient resouress of another commidty
Why demand curve slopes downward?
Demand curve is slope downward because of inverse relationship between price and quantity.
As you move from left to right the aggregate demand curve?
slopes downward
Slope of indifference curve?
indifference curves slopes downward to the right
Why engel curve slopes negatively downward in case of giffen goods?
The Engel curve shows how household expenditure on goods changes with rising income. Giffen goods are inferior goods. As household income rises, instead of consuming more of the Giffen goods, expenditure is switched to better quality goods. Consequently, the demand for a Giffen good falls as income rises and this results in a downward sloping curve. Incidentally, a curve that slopes "negatively downward" is actually a curve that slopes positively upwards!
Why does a demand curve slope downward left to right?
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
Why does a demand curve slope downward from left to to right?
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
When a graph of two variables form a curve that slopes downward from left to right the variables are said to what with one another?
11% of you dude
When the y values decrease and the x values increase how is that shown on a graph?
This has a negative slope (it slopes 'down' as you move from left to right).
What musical object is often used to describe the curve normal distribution produces?
A bell curve describes the graphed curve that normal distribution produces for a set of data. The curve slopes upward before returning downward after the point of the mean.
Characteristics of production possibility curve?
It slopes downward towards right:this shows that we will have to reduce the production of one commodity to increase the production of the another commodity.
