Aggregate demand and aggregate supply must be combined to determine the price level and the "real" GDP.

Question

Quizplus · Accepted Answer

Both aggregate demand and aggregate supply are factors that affect the overall economic output and the price level of goods and services. By analyzing the intersection of these two factors, economists can determine the equilibrium level of output and price in the economy. Therefore, it is necessary to combine aggregate demand and aggregate supply to determine both the price level and the real GDP.

Aggregate Demand and Aggregate Supply Must Be Combined to Determine