Chapter 12: Aggregate Demand Curve (page 428)
Why does the aggregate demand curve slope down?
the wealth effect, trade effect, and interest effect.
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What are the 4 components of aggregate demand?
Why do you think gas prices rose in the recessions of the 1970s but fell after the Great Recession?
A rise in productivity increases potential output, but some worry that demand for the additional output will be insufficient even in the long run. How would you respond?
What does this say about the causes of the recessions in each case?
Suppose the economy is initially at the potential output and the quantity of aggregate output supplied increases. What information would you need to determine whether this was due to a movement along the SRAS curve or a shift of the LRAS curve?
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