AD Worksheet

Increased consumption is a key factor in causing an increase in ___

What does AD stand for in the context of the given text?

• Consumption

• Investment

• Government spending

• Net exports

A fall in ___ causes a fall in real GDP and a fall in the price level.

What are some factors that could cause an increase in aggregate demand?

What does the downward slope of AD indicate?

• Increase in real income at lower price levels

• Decrease in real income at lower price levels

• No change in real income at lower price levels

• Fluctuation in real income at lower price levels

What does Aggregate demand (AD) represent?

• Total demand for goods and services produced within the economy

• Total supply of goods and services produced within the economy

• Total population of the economy

• Total land area of the economy

What component of AD accounts for about 66% of AD and is therefore very important?

• Government expenditure

• Investment

• Net exports

• Consumer expenditure