Aggregate demand (AD): แบบฝึกหัด

Which of the following factors is a reason for the downward-sloping aggregate demand (AD) curve?

Suppose the government of an economy significantly increases its expenditure on public infrastructure while simultaneously raising the nominal interest rate to control inflation. If the upward effect of government spending on Aggregate Demand (AD) is greater than the downward effect of the interest rate increase, the AD curve will:

An economy is grappling with persistent deflationary pressures and underutilized resources. To combat this, the central bank embarks on an aggressive campaign of open market operations, purchasing large quantities of government bonds. Concurrently, a major regional trade war escalates, significantly disrupting supply chains and causing a sharp decline in export orders for domestic firms. Furthermore, there is widespread consumer uncertainty about future job prospects, leading to an increase in precautionary saving.

Considering these developments, what is the most likely overall impact on the aggregate demand (AD) curve in the short run?

According to the expenditure approach, which of the following is not one of the three factors that explain why the aggregate demand (AD) curve is downward sloping?

Suppose an economy is experiencing a significant increase in the wealth of its households due to a booming stock market. Simultaneously, the government implements a contractionary fiscal policy by reducing its expenditure. Which of the following best describes the resulting movement or shift in the aggregate demand (AD) curve?

Explain how the interest rate effect leads to a downward-sloping Aggregate demand (AD) curve.

Suppose there is a tightening of consumer credit and a significant decline in the economic growth of trading partners. Explain the short-run impact of these events on the Aggregate demand (AD) curve and the equilibrium price level.
(6 marks)

Explain how the wealth effect accounts for the downward-sloping nature of the Aggregate demand (AD) curve.
(3 marks)

Suppose a country’s major trading partners experience a sudden economic boom, leading to an increase in their demand for foreign goods. Simultaneously, the country’s government increases the personal income tax rate to reduce the budget deficit.

(a) Explain the effects of the above two events on the aggregate demand (AD) curve of the country by referring to its components: \( C \), \( I \), \( G \), and \( NX \). (4 points)
(b) Based on your answer in (a), is it possible to determine the final direction of the shift in the AD curve? Explain. (1 point)

Consider an open economy where the Aggregate Demand (AD) is initially at equilibrium. Suppose two simultaneous events occur:
1. The central bank implements a tight monetary policy, leading to a significant increase in the nominal interest rate.
2. The economy's major trading partners recover from a recession, leading to an increase in their national income.

(a) Explain how the increase in the interest rate affects two different components of the AD. (3 points)
(b) Explain the effect of the recovery of trading partners on the Net Export (NX) of this economy. (2 points)
(c) Based on the above, can we conclude whether the AD curve will shift to the right, to the left, or remain unchanged? Explain your answer. (2 points)