seminar-type classess for сФ305

Aggregate demand forms the backbone of short-term macroeconomic analysis, as it brings together all sources of spending in the economy into a single framework. Its level is determined by the interaction of four main components: household consumption spending, business investment, government expenditure on goods and services, and net trade with the rest of the world. This interaction produces the aggregate demand curve, which shows an inverse relationship between the general price level and real total spending, due to the wealth effect, interest rate effect, and international trade effect. Government and central bank policies, such as changing interest rates, taxes, or public spending, are primarily used to influence this aggregate demand, aiming to achieve economic stability, full employment, and controlled i