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Chapter 16 Output and the Exchange Rate in the

Chapter 16 Output and the Exchange Rate in the Short Run Prepared by Iordanis Petsas domestic output Determinants of Aggregate Demand in an Open Economy

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Determinants of aggregate supply This section introduces the aggregate supply and aggregate demand model to explain the determination of equilibrium national output

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Why the AS and AD Curves Shift Now let s talk briefly about each of these determinants of aggregate demand Note that while equilibrium output falls

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A Model of the Macro-Economy Aggregate Demand and Price Level increases why does the amount of aggregate output are determinants that will shift the AS

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A few that based their studies on determinants of industrial output growth like Ogun mining building and on aggregate manufacturing output

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Learning Objectives Define potential output also called the natural level of GDP Define aggregate demand represent it using a hypothetical aggregate demand curve and identify and explain the three effects that cause this curve to slope downward

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Changes in any of the aggregate demand determinants The aggregate supply determinants The prices of resource affect the cost of producing output and

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Reasons for the Aggregate Demand Curve's Shape Nonprice-Level Determinants of Aggregate Demand As was the case with individual demand curves

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