Question

consumption expenditure theory is the only component of aggregate demand true or false​

Answer 1

Consumption expenditure is not the only component of Aggregate Demand(AD).Hence,the statement is false.

Explanation:

In Macroeconomics,AD is the summation or aggregation of consumption expenditure,aggregate investment level,overall government purchase/expenditure and net export considering open economy in this case.In the case of closed economy,net export is not considered in the calculation of AD.Therefore,aggregate consumption expenditure is only one and not the only component of AD.AD ideally represents the demand side of the economy which determines the aggregate output or GDP of the country or economy.

Answer 2

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