Anything -other than the desired (product/service)'s price- that would change the demand for a product/service would increase aggregate demand. Some examples may be: increased incomes, increased population, increased price of substitute products, etc..
Why doesn't an increase in aggregate demand translate directly into an increase in real GDP
An increase in interest rates decreases the aggregate demand shifting the curve to the left.
Aggreagate demand will increase.
Demand-pull is caused by an increase in aggregate demand.
An increase in aggregate demand and a decrease in aggregate supply will result in a shortage: there will be more goods and services demanded than that which is being produced.
Why doesn't an increase in aggregate demand translate directly into an increase in real GDP
An increase in interest rates decreases the aggregate demand shifting the curve to the left.
Aggreagate demand will increase.
Demand-pull is caused by an increase in aggregate demand.
Anything -other than the desired (product/service)'s price- that would change the demand for a product/service would increase aggregate demand. Some examples may be: increased incomes, increased population, increased price of substitute products, etc..
An increase in aggregate demand and a decrease in aggregate supply will result in a shortage: there will be more goods and services demanded than that which is being produced.
An increase in aggregate demand and a decrease in aggregate supply will result in a shortage: there will be more goods and services demanded than that which is being produced.
if decrease a price or if the expectation of raising a price
Left
The aggregate demand curve shifts to the right
Because a tax increase will cause consumption to decrease, an aggregate demand has a greater effect.
The aggregate demand curve shifts to the right