What are the major factors that determine investment, and what impact does each have on aggregate demand?
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Question:
What are the major factors that determine investment, and what impact does each have on aggregate demand?
Describe the difference between a microeconomics demand curve and an aggregate demand curve.
The aggregate demand curve portrays the relationship between price level and real GDP. What are the three reasons this relationship is negative or inverse? Provide brief illustrations of each.
What role do imports play in aggregate demand? Under which conditions will changes in imports expand aggregate demand? Reduce aggregate demand?
Expert Answer:
Major factors that determine investment include Interest Rates The cost of borrowing influenced by central bank policies and market forces affects investment decisions Lower interest rates incentivize ... View the full answer
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