a. Why aggregate demand curve (AD) (showing the relationship between price level (P) and real output/income (Y)) is negatively sloped? Please explain with details by benefiting from; i) wealth effect, ii) interest rate effect, and iii) exchange rate effect. What are the slopes of FE line and LRAS curve? Their place shows what level of output? Which factors cause these curves to shift

Exploring Economics
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ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter26: Monetary Policy
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a. Why aggregate demand curve (AD) (showing the relationship between price level (P) and real output/income (Y)) is negatively sloped? Please explain with details by benefiting from; i) wealth effect, ii) interest rate effect, and iii) exchange rate effect. What are the slopes of FE line and LRAS curve? Their place shows what level of output? Which factors cause these curves to shift ?

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