Characteristics of AD Flashcards
1
Q
Aggregate demand (AD)
A
Total amount of goods and services demanded in the economy at a given time and price level. It is the sum of consumption expenditure, investment expenditure, government expenditure and net exports.
2
Q
Animal spirits
A
The state of confidence or pessimism held by consumers and businesses.
3
Q
Components of AD
A
AD= C+I+G+(X-M) Consumption, Investment, Government expenditure and Net trade (Exports-Imports)
