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Chapter 25: Q. 8 (page 622)

Name some economic events not related to government policy that could cause aggregate demand to shift.

Short Answer

Expert verified

Exports and Imports, Consumption and Investments

Step by step solution

01

Definition

Aggregate demand :- Aggregate demand calculates the whole amount of demand for all finished goods and services made in an economy. It is a mechanism of macroeconomists used to determine or forecast general financial stability within a nation

02

Explanation

Some economic events which could cause aggregate demand to shift are

(a) Exports and Imports:

The more income there is - the more imports there are.

Exports are not based off the country at hand but off the situation in the other countries.

(b) Consumption:

It is based on the levels of income of the country.

(c) Investments:

These are based on the future economical projections in the country.

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