What are the three forces that cause the aggregate demand curve to slo

What are the three forces that cause the aggregate demand curve to slope down? Explain.

What will be an ideal response?

ANSWER

The three forces are the real-balance effect, the interest rate effect, and the open-economy effect. An increase in the price level causes the purchasing power of money balances to fall, interest rates to increase and borrowing to fall, and imports to increase and exports to decrease. Each of these cause total planned real expenditures to decrease.