Aggregate Demand (AD) = C + I + G + (X – M)
Advertisements
Advertisements
प्रश्न
What are the determinants of Aggregate demand?
विस्तार में उत्तर
Advertisements
उत्तर
Aggregate demand refers to the total demand for all goods and services in an economy at a given overall price level and in a given period of time. The main determinants are:
- Consumer Spending (C): The total expenditure by households on goods and services. It depends on factors such as disposable income, savings, taxation, interest rates, and consumer confidence.
- Investment Spending (I): The expenditure by businesses on capital goods like machinery, buildings, and technology. It is influenced by interest rates, business expectations, and the availability of credit.
- Government Expenditure (G): Spending by the government on public goods and services like education, defence, and infrastructure. It directly increases aggregate demand.
- Net Exports (X–M): The difference between exports and imports. When exports exceed imports, aggregate demand rises, and when imports exceed exports, it falls.
- Monetary and Fiscal Policies: Expansionary monetary or fiscal policies (like lowering taxes or increasing the money supply) tend to increase aggregate demand, while contractionary policies decrease it.
shaalaa.com
क्या इस प्रश्न या उत्तर में कोई त्रुटि है?
APPEARS IN
संबंधित प्रश्न
State the determinants of aggregate demand.
What is aggregate supply?
Explain national income equilibrium through aggregate demand and aggregate supply. Use diagram. Also explain the changes that take place in an economy when the economy is not in equilibrium
What is meant by aggregate demand?
State components of aggregate demand.
Explain how government spending can be helpful in removing deficient demand.
Why does consumption curve not start from the origin?
What is meant by inflationary gap?
State three measures to reduce inflationary gap.
Aggregate demand can be increased by ______
Define aggregate supply?
Explain the role of Repo Rate in reducing the Inflationary gap.
Explain the concept of deflationary gap.
Name any two components of 'aggregate demand'.
Explain the role of Cash Reserve Ratio in removing an inflationary gap
explain the role of Bank Rate in correcting deficient demand?
Explain the subjective factors which determine consumption function.
Explain with reason, whether you agree or disagree with the following statement:
Aggregate supply is influenced only by availability of natural resources.
Write explanatory answer:
What is Aggregate demand ? Explain the determinants of Aggregate demand.
Explain the following concepts or give definitions.
Depreciation
State whether the following statements are True or False with reason:
Income earned from foreign investment is considered for aggregate demand.
What is ‘effective demand’? How will you derive the autonomous expenditure multiplier when price of final goods and the rate of interest are given?
Fill in the blank with appropriate alternatives given below
The General Theory of Employment, Interest and Money was written by __________.
Fill in the blank with appropriate alternatives given below
That part of income, which is not spent on consumption, is called __________.
State whether the following statement is true or false.
The equality between aggregate demand and aggregate supply determines the equilibrium level of employment.
Define or Explain the following concept:
Aggregate Supply
Answer the following question:
What are the determinants of Aggregate Demand (AD)?
Answer the following question:
What are the determinants of Aggregate Supply (AS)?
Answer in detail.
Explain the equilibrium between Aggregate Demand and Aggregate Supply.
Explain the concept of deficient demand with the help of aggregate demand and aggregate supply curves. Discuss one physical and one monetary measure to correct it.
Answer the following question.
State and discuss the components of Aggregate Demand in a two-sector economy.
Discuss the working of the adjustment mechanism in the following situations:
Aggregate demand is greater than the aggregate supply.
Answer the following question.
Describe the adjustments that may take place in an economy when ex-ante Aggregate Demand is greater than ex-ante Aggregate Supply.
What is meant by the “Effective Demand Principle” in the Keynesian theory of employment? Discuss using a schedule or a diagram.
On which factor Keynesian Theory of Employment depends?
An increase in aggregate demand of equilibrium level of income and employment causes an increase in ______
Keynes theory is associated with ______
Aggregate supply is equal to ______.
What is meant by Equilibrium income?
How is it determined by using Saving and Investment approach?
In case of an under-employment equilibrium, which of the following alternatives is not true?
Identify the correctly matched pair from Column A to Column B:
| Column A | Column B |
| (1) Y = AD | (a) Level of output at full employment |
| (2) Forward Multiplier | (b) Withdrawal of investment decreases income |
| (3) Paradox of Thrift | (c) People save less or same as before |
| (4) Multiplier (k) < 1 | (d) 0 < MPC < 1 |
When the value of the currency falls as compared to other currencies, it is ______
The equilibrium level of income/output is established when ______
The slope of the supply curve is measured by ______.
When aggregate demand is greater than aggregate supply, inventories:
Why is effective demand also known as expost demand?
With reference to Simple Keynesian model, give the meaning of ex-ante demand.
With the help of a diagram, determine the equilibrium level of output and income by using Aggregate demand and aggregate supply approach.
