Aggregate Demand Flashcards
1
Q
AD definition
A
The total demand for all goods and services in an economy at any given price level over a period of time
2
Q
Price level definition
A
The average price of all goods and services in an economy
3
Q
Gross investment
A
Spending on capital assets (e.g. machinery)
4
Q
Net investment
A
Value after depreciation
5
Q
Multiplier effect
A
When an initial increase in an injection leads to a bigger overall effect on the economy
6
Q
Automatic stabilisers
A
The government will pay more in unemployment benefits helping to counter the fall in demand
