Aggregate demand is
A) the horizontal summation of all demand curves for a product.
B) the sum of all planned expenditures for the economy.
C) the total quantity of all goods sold in an economy in a year.
D) the horizontal summation of all demand curves for state, local, and federal governments and business firms.

Question

Quizplus · Accepted Answer

Aggregate demand refers to the sum of all planned expenditures (consumption, investment, government spending, and net exports) in an economy. It represents the total demand for goods and services within an economy at a given price level. Option A refers to the concept of market demand, and option C is referring to the GDP (gross domestic product) of an economy. Option D is incorrect because it is not a comprehensive definition of aggregate demand.

Aggregate Demand Is