Final answer:
A decrease in the aggregate price level does not directly cause an increase in aggregate demand.
Step-by-step explanation:
Aggregate demand refers to the total demand for goods and services in an economy. It is affected by various factors, including the price level. In general, a decrease in the aggregate price level does not directly cause an increase in aggregate demand.
Aggregate demand is made up of consumption, investment, government spending, and net exports. When the price level falls, it may lead to a decrease in consumption and investment because people and businesses may delay spending in anticipation of further price decreases.
This can offset any potential increase in aggregate demand caused by the decrease in prices. Therefore, option B is the correct answer: the aggregate quantity demanded of real GDP decreases if the price level falls.