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Aggregate Demand and Domestic Final Demand Quiz
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Aggregate Demand and Domestic Final Demand Quiz

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Questions and Answers

What does the aggregate demand (AD) represent in macroeconomics?

  • The demand for consumer spending and investment only
  • The demand for government expenditure and net exports only
  • The demand for the gross domestic product of a country
  • The total demand for final goods and services in an economy at a given time (correct)
  • What factors make up the aggregate demand?

  • Consumer spending, investment, corporate and government expenditure, and net exports (correct)
  • Investment, corporate expenditure, and net exports only
  • Consumer spending, government expenditure, and net exports only
  • Consumer spending, investment, and corporate expenditure only
  • How is the aggregate demand curve plotted?

  • With consumer spending on the horizontal axis and investment on the vertical axis
  • With real output on the horizontal axis and the price level on the vertical axis (correct)
  • With the price level on the horizontal axis and real output on the vertical axis
  • With government expenditure on the horizontal axis and net exports on the vertical axis
  • What does the downward sloping aggregate demand curve represent?

    <p>The amount of goods and services that will be purchased at all possible price levels</p> Signup and view all the answers

    How is the downward sloping aggregate demand curve derived?

    <p>With the help of three macroeconomic assumptions about the functioning of markets</p> Signup and view all the answers

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