ECONOMICS
AGGREGATE DEMAND
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
real-balances, interest-rate, and foreign purchases effects.
|
|
|
determinants of aggregate supply.
|
|
|
determinants of aggregate demand.
|
|
|
sole determinants of the equilibrium price level and the equilibrium real output.
|
Detailed explanation-1: -The factors that affect the amounts that consumers, businesses, government, and foreigners wish to purchase at each price level are the: determinants of aggregate demand. The aggregate supply curve: shows the various amounts of real output that business will produce at each price level.
Detailed explanation-2: -Aggregate demand is the sum of four components: consumption, investment, government spending, and net exports.
Detailed explanation-3: -Aggregate supply is the goods and services produced by an economy. It’s driven by the four factors of production: labor, capital goods, natural resources, and entrepreneurship. These factors are enhanced by the availability of financial capital.
Detailed explanation-4: -The aggregate demand curve shifts to the right as the components of aggregate demand-consumption spending, investment spending, government spending, and spending on exports minus imports-rise. The AD curve will shift back to the left as these components fall.
Detailed explanation-5: -This downward slope indicates that increases in the price level of outputs lead to a lower quantity of total spending. The graph shows a downward sloping aggregate demand curve, showing that, as the price level rises, the amount of total spending on domestic goods and services declines.