What is aggregate demand in a closed economy?Economy:An economy is considered as a system of various activities like production, consumption, and exchange of goods and services performed by different economic agents. The economy consists of mainly four sectors, namely, household, firms, government,...
The Austrian economic school of thought believes the market itself can find the best way to proceed. It challenges the mathematical models that economists use when trying to make predictions. Not long after the Russian Revolution, Austrian Economists predicted the eventual collapse of the communist ec...
Nations seen to fear slow economic growth and expansion the most. There is this constant competition to increase GDP and growth rate. But it doesn't seem realistic to me. I don't think that any economy can keep growing at a very high rate. There has to be a limit to the expansion. ...
Definition:An economic recession is a significant decline in economic activity, real GPD, real income, employment, industrial production, and sales following a decline in the aggregate demand for at least two quarters. What Does Economic Recession Mean?
Aggregate price level is the general price of the goods and services in an economy over a period of time. Changes in the level...
Macro Economics: It is that branch of economics which studies the entire economy, instead of individual units, i.e. level of output, total investment, total savings, total consumption, etc. Basically, it is the study ofaggregates and averages. It analyses the economic environment as a whole...
wages translate into increased consumption and savings. The saved money is often in banks, which are allowed to loan out more money than they take in according to their reserve requirements. The money they loan out goes toward investment and more wages, and at every step aggregate expenditure ...
What is the best economic indicator, besides the GDP, to measure the economy of a nation? How to calculate the real GDP and the components of aggregate expenditures? How do we know that calculating GDP by the expenditure approach yields the same answer as calculating GDP by the income approac...
Economic growth is an increase in the production of economic goods and services in one period of time compared with a previous period. It can be measured in nominal or real terms. Traditionally, aggregate economic growth is measured in terms ofgross national product (GNP)orgross domestic product...
Certain economic viewpoints, such as theKeynesian theory, assert that long-run aggregate supply is still price elastic up to a certain point. Once this point is reached, supply becomes insensitive to changes in price.2 Aggregate supply is represented by the aggregate supply curve, which describes ...