What causes the aggregate demand curve to shift?
What will be an ideal response?
Anything that causes total planned real expenditures on domestic goods to increase or decrease, other than changes in the price level, causes the curve to shift. These include things like changes in the exchange rate, changes in economic conditions in other countries, changes in the real interest rate (not associated with price level changes), and a change in the amount of money in circulation.
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When we compare shares of income earned by U.S. households over the past 40 years, which of the following statements about the distribution of income is true?
A) The percentage of total income represented by each quintile has increased. B) The percentage of total income represented by each quintile has decreased. C) The largest gain in income percentage is in the top 5% of households. D) Lower-income households gained at the expense of higher-income households.
_____ measures the percentage change in quantity demanded of a good caused by a given percentage change in the price of a related good
a. Income elasticity of demand b. Cross-price elasticity of demand c. Advertising elasticity of demand d. Price elasticity of demand e. Point elasticity