Aggregate demand is the amount of total spending on domestic goods and services in an economy. The downward-sloping aggregate demand curve shows the relationship between the price level for …

A vertical long-run aggregate supply curve labeled “LRAS.” The LRAS should be vertical at the full employment output. The placement of the LRAS curve will depend on whether the economy has an …

We can find this point on the diagram below; it's where the aggregate supply, AS, and aggregate demand, AD, curves intersect, showing the equilibrium level of real GDP and the equilibrium price …

The aggregate demand (AD) curve shifts when people, businesses, or the government change how much they spend, invest, or tax. These shifts affect the total output and prices in the economy, …

If either the aggregate supply or aggregate demand curve shifts in the aggregate demand/aggregate supply—AD/AS—model, the original equilibrium in the AD/AS diagram will shift to a new equilibrium.

In this lesson summary review and remind yourself of the key terms and graphs related to the Phillips curve. Topics include the short-run Phillips curve (SRPC), the long-run Phillips curve, and the …

Learn about the different axes used for plotting aggregate demand, and explains three theories behind the downward slope of the aggregate demand curve: the wealth effect, the interest rate effect, and …

Use a diagram to analyze the relationship between aggregate expenditure and economic output in the Keynesian model.

If a factor of aggregate demand changes in response to anything other than a change in the price level shifts aggregate demand. In this video, we explore the shifters of AD and factors that might shift …

Say’s Law states that supply creates its own demand; changes in aggregate demand have no effect on real gross domestic product or employment, only on the price level. Say’s Law can be shown on the …