Aggregate Demand Shifts vs. Movements

Steps:

• AD curve plots real output demanded at various price levels; shifts occur from changes in C, I, G, or NX.
• Price level changes cause movements along the existing AD curve, not shifts.
• Options B, C, D affect AD components, shifting AD rightward to AD1.
• Option A only moves along AD0, so it does not cause the shift.

Why A is correct:

• A fall in price level increases quantity demanded via the wealth effect, causing a movement down along AD0, per the AD definition.

Why the others are wrong:

• B increases consumer spending (C) through easier credit, shifting AD right.
• C boosts net exports (NX) via higher export earnings, shifting AD right.
• D raises investment (I) in capital, shifting AD right.

Final answer: A