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What Is The Aggregate Demand Curve?

2010/7/22 20:04:00 44

Aggregate Demand Curve

The aggregate demand curve represents the equilibrium total expenditure level of the economy and society under a series of total price levels, that is, the total demand curve represents the trajectory of the equilibrium total expenditure in the economy with the change of the total price level. The aggregate demand curve is a curve that slopes downward to the right.

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What Is The Aggregate Demand Function?

The aggregate demand function is a function of the relationship between the total price level and the equilibrium total expenditure. Y indicates that the economy is at a balanced level of total expenditure AE, while P indicates the general price level, the total demand function AD can be expressed as: Y = AD (P).