In this article we will discuss about the role of Aggregate Demand (AD) and Aggregate Supply (AS) in the Keynesian Model, explained with the help of a suitable diagram. Like the Keynesian model, the classical model also employs aggregate supply and aggregate demand—but with two important differences. First, the aggregate supply schedule corresponding to SAS in Fig. 10 is assumed [...]
This article will help you to learn about the difference between the Classicists and Keynes on Aggregate Demand (AD) and Aggregate Supply (AS). Difference between Classicists and Keynes on Aggregate Demand and Aggregate Supply The classical economists believed in the operation of the Say's Law of Markets which states that supply creates its own demand. They also assumed sufficient wage-price [...]
Get the answer of: What is Aggregate Demand? National output or GNP as also the general price level are determined by the interplay of aggregate demand and aggregate supply. This means that the total production of a country is determined partly by aggregate demand and partly by aggregate supply. Aggregate demand refers to the quantity of goods and services that [...]