Difference between Aggregate demand and Aggregate supply
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Answer:
Aggregate supply
Aggregate supply refers to the total supply of all commodities produced by all the entrepreneurs put together at a particular level of employment in an economy. The expenditure incurred by the enterprenuer to play the factors of production ,including the normal profits they expect for their services, is called cost of production . This minimum amount that the entrepreneur in the economy must obtain as price for the total output is called the Aggregate Supply Price . The term aggregate supply price, often called aggregate supply, refers to the minimum total income that the entrepreneurs must receive.
Aggregate demand
Aggregate demand means the total for all commodities in the economy at a particular level of employment. The amount they spend on consumption goods is called consumption expenditure and their expenditure on capital goods is called investment. The entrepreneurs expect that the community as a while is willing to spend certain amount towards purchase of the total output.The expected expenditure is termed as aggregate demand price. The term Aggregate demand price refers to the expected expenditure on the part of the community. From the point of view of entrepreneurs it is the expected income (cost of production and expected profit).