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Questions and Answers
What does Aggregate Demand (AD) represent?
What does Aggregate Demand (AD) represent?
- Total expenditure on goods and services in an economy during a period of time (correct)
- Total production of goods and services in an economy during a period of time
- Total investment in the economy during a period of time
- Total income of all sectors of the economy during a period of time
What are the components of Aggregate Demand (AD)?
What are the components of Aggregate Demand (AD)?
- Household consumption expenditure, Investment expenditure, Govt. consumption expenditure, Net export (correct)
- Household debt, Business loans, Government spending, Import costs
- Household income, Business revenues, Government grants, Export revenue
- Household savings, Corporate profits, Government subsidies, Foreign investment
How is Aggregate Demand (AD) calculated?
How is Aggregate Demand (AD) calculated?
- AD = C / I / G / (X - M)
- AD = C - I + G - (X - M)
- AD = C * I * G * (X - M)
- AD = C + I + G + (X - M) (correct)
