Components of Aggregate Demand Flashcards
1
Q
aggregate demand
A
- measure of all demand
- consumption
- government services
- investment
- net exports (exports minus imports)
- calculating real output
- use of the consumer price index
- calculating the average price level
- price of a new phone
- calculating the total output for Portugal
- macroeconomics
2
Q
remember this
A
price is on the y-axis, and real output is on the x-axis
3
Q
simple demand
A
the demand for one product and its corresponding price
4
Q
as the real output drops, what happens to the average price
A
it rises
5
Q
what is the real output of the aggregate demand model
A
everything the economy produces
