An increase in aggregate demand would cause foreign investment to rise. unemployment to rise. the price...
An increase in aggregate demand would cause
| foreign investment to rise. |
| unemployment to rise. |
| the price levels to rise. |
The aggregate demand represents total spending on ________.
| a nation’s total budget |
| a nation’s domestic output of goods and services |
| the total supply of domestic and imported goods |
Which component of aggregate demand would initially be affected by a change in exchange rates?
| consumption |
| net exports |
| government spending |
Homework Answers
1. Ans: the price levels to rise.
2. Ans: a nation’s domestic output of goods and services.
3. Ans: net exports
Explanation:
The aggregate demand represents total spending on a nation's domestic goods and services. There is a close relationship between aggregate demand and the aggregate price level. Any change in exchange rate leads a change in net exports ( Exports - Imports ) .
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