Chapter 14 Aggregate Demand and Aggregate Supply

| November 9, 2018

47)
Aggregate demand is the total demand for intermediate goods and services in an
entire economy.

48)
Higher prices lead to higher levels of real wealth.

49)
Aggregate demand will be affected by the purchasing power of money.

50)
The purchasing power of money decreases as the price level increases.

51)
When considering the aggregate demand curve, the wealth effect, interest rate
effect and effects from international trade reinforce each other.

52)
Decreases in taxes shift the aggregate demand curve to the right.

53)
An increase in the money supply will increase aggregate demand.

54)
An increase in government spending will shift the aggregate demand curve to the
left.

55)
The ratio of the total shift in aggregate demand to the initial shift in
aggregate demand is known as the multiplier.

56)
The relationship between the level of income and investment spending is known
as the consumption function.

57)
What are the four components of aggregate demand?

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