Aggregate Demand Assignment Help

Definition of Aggregate demand

In macroeconomics, aggregate demand is recognized by the total amount of demand of final goods and services at a given overall price level in the present economy at a given time period. This term defines the demand for the gross domestic product of a country. It describes the relation between price levels and the sum of out that firms desire to provide.

How Aggregate demand works?

The mathematical equation that represents Aggregate Demand is,

Aggregate Demand (AD) = C + I + G + (X-M) C = Consumers' expenditures on goods and services.

I = Investment that companies spend on capital goods.

G = Government expenditures on publicly provided goods and services.

X = Exports of goods and services.

M = Imports of goods and services.

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