What is aggregate demand? What are its major components?
Aggregate demand is the total amount that all consumers, business firms, and government agencies spend on final goods and services. The major components are:
1 . Consumer expenditure is the total value of all consumer goods and services demanded.
2 . Investment spending is the amount that firms spend on factories, machinery, software, and the like, plus the amount that families spend on new houses.
3 . Government purchases of goods and services, includes items such as paper, computers, airplanes, ships, and labor bought by all levels of government.
4 . Net exports is defined as U.S. exports minus U.S. imports.
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In the model of perfect competition, firms produce a
A) standardized product with considerable control over price. B) differentiated product with no control over price. C) differentiated product with considerable control over price. D). all of the above. E). none of the above.
When the quantity of money demanded is greater than the quantity of money supplied, people ________ bonds and the interest rate ________
A) sell; rises B) sell; falls C) buy; rises D) buy; falls
All of the following lead to a difference in income EXCEPT
A) sales tax. B) discrimination. C) the age-earnings cycle. D) marginal productivity.
Between 1810 and 1860, the value of slaves in the United States
a. nearly doubled. b. tripled. c. increased nearly fourfold. d. increased nearly tenfold.