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Explain the deteminants of aggregate demand?
Answers
Answer:
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The determinants work through the four aggregate expenditure categories--consumption expenditures, investment expenditures, government purchases, and net exports. Should any specific aggregate demand determinant change, it must affect the aggregate demand curve through one of the four aggregate expenditures.
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hey there!!
▶Aggregate demand is the total demand for final goods and services in an economy at a given time. It specifies the amounts of goods and services that will be purchased at all possible price levels. It is measured as:
A.D. = C + I + G + (X-M)
where,
A.D. is Aggregate Demand
C is consumption expenditure
I is Investment expenditure
G is Government expenditure and
(X-M) are Net exports (expenditure on Exports)
hope it helps