Determinants Of AD (1) Flashcards
1
Q
Aggregate Demand
A
Total planned spending on all goods and services produced in domestic economy in a period of time
2
Q
Consumption
A
Total planned spending by households on domestic goods and services
3
Q
Investment
A
Spending by firms on capital goods
4
Q
Government spending
A
Spending by the government on goods and services
5
Q
Net exports
A
Difference between total value of produced goods sold abroad and the total value of foreign goods bought by domestic consumers, firms and government
6
Q
AD equation
A
AD = C + I + G + (X - M)
