If you wanted to increase aggregate demand how would you do it for the following: Consumption...
If you wanted to increase aggregate demand how would you do it
for the
following:
Consumption demand
Investment demand
Net exports
Which of the three components also has an impact upon the Aggregate
supply
side of the economy?
Homework Answers
Answer : 1) The components of aggregate demand are consumption, investment, government expenditure and net export. Now if I increase consumption demand then the aggregate demand will increase. Similarly, if I increase investment demand and net export then also the aggregate demand will increase. So, to increase the aggregate demand I will increase consumption demand, investment demand and net export.
2) The main two components of aggregate supply are consumption and savings. Consumption is also a component of aggregate demand. So, the consumption component of aggregate demand has impact upon aggregate supply of the economy.
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If you wanted to increase aggregate demand how would you do it
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