Booklet 2 - Macro Flashcards
1
Q
Definition - aggregate demand
A
The total planned spending on the output in an economy
2
Q
Aggregate demand equation
A
AD = C + I + G + (X - M)
3
Q
Definition - consumer spending
A
The act of using disposable income to purchase goods and services
- 2/3 of GDP
4
Q
Definition - consumer durables
A
Things that last a long time
5
Q
Definition - consumer expenditure
A
Disposable income
6
Q
Definition - inflation
A
Rise in prices over time across an economy
7
Q
Definition - demand-pull inflation
A
Increase in demand has pulled up the price
