--%>

Components of aggregate demand

What are the components of aggregate demand (AD)?

Answer: The components of AD are as follows:
AD = C + I + G + (X - M)
By Simplifying AD = C + I,
Here C refers to Household consumption demand and I refer to the Investment Demand.

   Related Questions in Macroeconomics

  • Q : Principles of macroeconomics Explain

    Explain the concept of “economies of scale” and “increasing returns”.

  • Q : Principles of macroeconomics What are

    What are the “powers of the Federal Reserve

  • Q : Perfectly substitutable outcome Firms

    Firms which serve customers who vision the firm’s output as perfectly substitutable for the outcomes of huge numbers of other firms confront: (i) Horizontal (that is, perfectly price elastic) demand curves. (ii) Predatory pricing from greater mo

  • Q : Definition of equilibrium price

    Definition of equilibrium price: It is the price which balances quantity demanded and quantity supplied. The equilibrium price is frequently termed as the "market-clearing" price since both buyers and sellers are p

  • Q : Competitive market What do you mean by

    What do you mean by the term Competitive market?

  • Q : Weighed marginal cost and marginal

    Cite examples of recent decisions that you made in which you, at least implicitly, weighed marginal cost and marginal benefit?

  • Q : Problem on Imperfect information

    Imperfect information at times causes consumer’s attempts to maximize their contentment to fail since: (i) Prospects are imperfectly realized, and trial-and-error prototypes can lead to mistakes. (ii) Sellers might exploit asymmetric information

  • Q : Implications of fiscal deficit

    Implications of fiscal deficit: (A) High fiscal deficit entails a big amount of borrowings in which the government takes more loans to pay back it. It raises the liability of government.

    Q : Economic growth model Explain the main

    Explain the main features of Harrod - Domar Growth model. How does the Harrod Domar model explain the occurrence of trade cycles?

  • Q : Why Exceptional Demand Curve Explain

    Explain with examples the reasons for exceptional demand curve