How is an aggregate demand curve derived

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Suppose MPC is 0.8 initially. Households then change their behavior so that the MPC falls to 0.75. What happens to aggregate expenditures? Why?

whatWhat is a consumption function? Describe the graph of a consumption function and explain its shape. If total spending is consumption plus investment spending, how does an increase in the interest rate affect total spending?

For each of the following, explain whether it shifts the short-run aggregate supply curve, the long-run aggregate supply curve, or the aggregate demand curve (or more than one of these)

Households decide to save a smaller share of their disposable income

How is an aggregate demand curve derived and What would cause the aggregate demand curve to shift to the right?

Explain what would cause the government purchases function to increase. Will a change in social security spending affect government purchases?

Reference no: EM13766071

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