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AGGREGATE DEMAND DETERMINANTS: An assortment of ceteris paribus factors that affect aggregate demand, but which are assumed constant when the aggregate demand curve is constructed. Changes in any of the aggregate demand determinants cause the aggregate demand curve to shift. While a wide variety of specific ceteris paribus factors can cause the aggregate demand curve to shift, it's usually most convenient to group them into the four, broad expenditure categories -- consumption, investment, government purchases, and net exports. The reason is that changes in these expenditures are the direct cause of shifts in the aggregate demand curve. If any determinant affects aggregate demand it MUST affect one of these four expenditures.
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INDUCED INVESTMENT Business investment expenditures that depend on income or production (especially national income and gross domestic product). That is, changes in income induce changes in investment. Induced investment reflects the observation that the business sector is inclined to reinvest profits (boosted by a growing economy) in capital goods. It is measured by the marginal propensity to invest (MPI) and is reflected by the positive slope of investment line. The alternative to induced investment is autonomous investment, which does not depend on income.
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BEIGE MUNDORTLE
[What's This?]
Today, you are likely to spend a great deal of time wandering around the shopping mall seeking to buy either a flower arrangement in a coffee cup for your father or a how-to book on meeting people. Be on the lookout for broken fingernail clippers.
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The word "fiscal" is derived from a Latin word meaning "moneybag."
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"To succeed you need to find something to hold on to, something to motivate you, something to inspire you." -- Tony Dorsett, Football player
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LRAC
Long Run Average Cost
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