If an economy experiences a decrease in aggregate demand, what is the likely immediate effect on unemployment and inflation?

When an economy experiences a decrease in aggregate demand, it means that consumers, businesses, and the government are spending less money on goods and services. This lower demand can lead to businesses producing less, which often results in layoffs or hiring freezes. As a result, unemployment tends to rise because more people are looking for jobs but fewer jobs are available. At the same time, with less money being spent, prices may not rise as quickly, or they might even fall, leading to lower inflation or deflation. For example, if a popular restaurant sees fewer customers due to a decrease in spending, it might cut staff, causing unemployment to increase while also lowering prices to attract more diners.