What is the Aggregate Demand in an economy?

The aggregate demand (AD) is the total quantity produced in an economy at a given price and is equal to the national income and real GDP.
AD is composed of 4 parts: Consumption (C), Investment (I), Government spending (G), Net exports (X-M)
The formula is AD = C + I + G + (X-M)

HC
Answered by Harshith C. Economics tutor

1941 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Explain how the price mechanism responds to excess supply in a free market


Is price capping an effective way to deal with monopolistic power?


explain the effect of a rise in government expenditure in the AD-AS framework


How would I answer a 'discuss the view that price discrimination only benefits suppliers' essay question?


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2025 by IXL Learning