ECONOMICS
AGGREGATE DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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G+U = (X-M)
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C+I+G+ (X-M)
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(X-M) = G+I+C
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None of the above
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Detailed explanation-1: -The five components of aggregate demand are consumer spending, business spending, government spending, and exports minus imports. The aggregate demand formula is AD = C + I + G + (X-M).
Detailed explanation-2: -This is often written as C + I + G + (X-M), where C is personal consumption expenditures, I is investment, G is government purchases of goods and services, X is exports, and M is imports. Together, this is all of Gross Domestic Product, or GDP.
Detailed explanation-3: -Aggregate demand is calculated by adding the amount of consumer spending, government and private investment spending, and the net of imports and exports. It is represented with the following equation: AD = C + I + G + Nx. The components of aggregate demand are as follows: C = consumer spending on goods and services.
Detailed explanation-4: -Aggregate demand is the sum of four components: consumption, investment, government spending, and net exports. Consumption can change for a number of reasons, including movements in income, taxes, expectations about future income, and changes in wealth levels.
Detailed explanation-5: -Aggregate Demand = C + I + G + (X – M) where, C = Consumer Spending. I = Investment in Capital Goods. G = Government Spending.