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What Is The Aggregate Demand Function?

2010/7/22 20:04:00 38

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).

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What Is The Total Supply Curve?

The aggregate supply curve represents the output of the economy under a series of general price levels, that is, the total supply curve represents the trajectory of the total output of the firms in the economy, which is willing and able to supply, as the price changes. The aggregate supply curve is a curve inclined to the left.