Aggregate Demand/Aggregate Supply

Some Things to Know

1. What is aggregate demand?

2. What does an aggregate demand curve show? (What is measured on each axis?)

3. Why does the aggregate demand curve slope downward to the right? (Three reasons - and be able to explain how each contributes to negative slope.)

4. What factors would shift aggregate demand curve?

5. What does an aggregate supply curve show? (What is measured on each axis?)

6.What accounts for the shape of an aggregate supply curve?
1. short run
2. long run

7.What factors would cause a shift of the aggregate supply curve?
1. short run curve
2. long run curve

8.Illustrate and explain the impact of stimulative monetary or fiscal policy in different segments of the short run aggregate supply curve.

9.Illustrate the effects of a supply side shock - using aggregate demand and aggregate supply curves.

10. Illustrate demand - pull inflation using aggregate demand and aggregate supply curves.