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Question
Effective demand is known as ______.
Options
ex-post demand
actual aggregate demand
planned demand
both ex-post demand and actual aggregate demand
MCQ
Fill in the Blanks
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Solution
Effective demand is known as ex-post demand and actual aggregate demand.
Explanation:
Effective demand is known as actual or ex-post demand because it represents the aggregate demand that is fully realised and backed by purchasing power in the market. Unlike planned (ex-ante) demand, which reflects what people intend to spend, effective demand measures the actual expenditures spent on final goods and services. Therefore, it is correctly described as both ex-post demand and actual aggregate demand.
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