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What are the factors that would affect the aggregate demand?
Consumption, investment, government spending, net exports, and aggregate expenditures.
Why interest rate has no affect on the aggregate demand?
The interest rate does affect aggregate demand. As the interest rate falls, aggregate demand increases and vice-versa.
How would a rise in the business investment affect the aggregate demand curve?
The aggregate demand curve shifts to the right
What relationship does the aggregate demand curve show between the quantity of real GDP demanded and other economic factors?
The aggregate demand curve shows the relationship between the quantity of real GDP demanded and factors like price levels, interest rates, and government spending. It illustrates how changes in these factors can affect the overall demand for goods and services in the economy.
What factors influence the relationship between the total demand for output and the aggregate demand curve?
Several factors can influence the relationship between total demand for output and the aggregate demand curve. These factors include changes in consumer spending, investment levels, government spending, and net exports. Additionally, factors such as interest rates, inflation, and overall economic conditions can also impact the aggregate demand curve.
What are the factors that would affect the aggregate demand?
Consumption, investment, government spending, net exports, and aggregate expenditures.
Why interest rate has no affect on the aggregate demand?
The interest rate does affect aggregate demand. As the interest rate falls, aggregate demand increases and vice-versa.
How would a rise in business affect the aggregate demand curve?
The aggregate demand curve shifts to the right
How would a rise in the business investment affect the aggregate demand curve?
The aggregate demand curve shifts to the right
What relationship does the aggregate demand curve show between the quantity of real GDP demanded and other economic factors?
The aggregate demand curve shows the relationship between the quantity of real GDP demanded and factors like price levels, interest rates, and government spending. It illustrates how changes in these factors can affect the overall demand for goods and services in the economy.
What factors influence the relationship between the total demand for output and the aggregate demand curve?
Several factors can influence the relationship between total demand for output and the aggregate demand curve. These factors include changes in consumer spending, investment levels, government spending, and net exports. Additionally, factors such as interest rates, inflation, and overall economic conditions can also impact the aggregate demand curve.
Because tax cuts will likely affect both aggregate demand and aggregate supply does it matter which is affected more?
Because a tax increase will cause consumption to decrease, an aggregate demand has a greater effect.
What is the definition of demand side policy?
Policies designed to affect aggregate demand: fiscal policy and monetary policy.
What will happen when Aggregate demand and aggregate supply decrease?
When aggregate demand and aggregate supply both decrease, the result is no change to price. As price increases, aggregate demand decreases, and aggregate supply increases.
Which of these is centered on aggregate demand?
Fiscal policy is centered on aggregate demand.
In an aggregate demand-aggregate supply diagram what will equal decreases in government spending and taxes do?
No effect. Spending will decrease Aggregate Demand, lower taxes will raise Aggregate Demand
What factors change and what factors remain the same when there is a movement along the aggregate demand curve?
The aggregate demand curve shows the relationship between the quantity of real GDP demanded and the price level when other influences on expenditure plans remain the same. When there is a movement along the aggregate demand curve, the price level changes and other factors such as expectations, fiscal and monetary policy, and the world economy remain the same
