Advertisements
Advertisements
Question
State components of Aggregate demand ?
Solution
Components of aggregate demand:-
1. Private consumption expenditure (C) is the total expenditure of households on final goods and services to satisfy their wants. It includes autonomous consumption expenditure and induced consumption expenditure.
2. Private investment expenditure (I) is ex-ante investment by private investors corresponding to different income levels in the economy. It includes autonomous investment expenditure and induced investment expenditure.
3. Government expenditure (G) is the planned expenditure by the government on consumption and investment expenditure for the welfare of the economy.
4. Net export (X–M) is the difference between the goods and services produced domestically by the rest of the world and abroad by the residents of a country.
APPEARS IN
RELATED QUESTIONS
Explain the concept of 'deficient demand' in macroeconomics.
Define aggregate supply?
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.
Fill in the blank with appropriate alternatives given below
That part of income, which is not spent on consumption, is called __________.
Define or Explain the following concept:
Aggregate Demand
Distinguish between:
Aggregate Demand and Aggregate Supply
State with reason whether you agree or disagree with the following statement.
Aggregate demand depends only on the consumption expenditure.
Answer in detail.
What is Aggregate Supply? Explain the determinants of Aggregate Supply.
Discuss the working of the adjustment mechanism in the following situations:
Aggregate demand is greater than the aggregate supply.
Discuss the adjustment mechanism in the following situation :
Aggregate demand is lesser than Aggregate Supply.
In a closed economy, aggregate demand is the sum of ______.
Aggregate supply is equal to ______.
What is meant by Equilibrium income?
Which of the following are the definitions of money supply in India?
When the value of the currency falls as compared to other currencies, it is ______
Which of the following statement is true?
The equilibrium level of income/output is established when ______
If planned savings exceeds planned investments in an economy, explain its likely impact on income, output and employment.
