The aggregate demand curve is a graphical representation of the relationship between the total amount of goods and services that consumers are willing to buy (as measured by aggregate demand) and their corresponding price level. The downward slope of this curve can be attributed to two primary factors: consumer preferences and the substitution effect.

Consumer preferences refer to the notion that, as prices rise, consumers are less likely to purchase these goods or services due to their diminishing value relative to other options available in the market. This is an important factor when considering how changes in price levels affect aggregate demand because it implies that people will tend to substitute those items with lower-priced ones in order to maximize their satisfaction from consumption.