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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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                           ECONOMY: The system of production, distribution, and consumption of goods and services that a society uses to address the problem of scarcity. An economy can be simple, such as that illustrated by the hilarious antics of the hapless passengers and crew of the U.S.S. Minnow on the highly popular economic documentary, Gilligan's Island. Or it can be exceedingly complex, such as the modern U.S. economy with millions of workers, thousands of corporations, and trillions of dollars worth of capital that are used to produce trillions of dollars worth of goods and services for millions of people.Production and ConsumptionThe essential task of an economy is to transform resources into useful goods and services (the act of production), then distribute or allocate these products to useful ends (the act of consumption). Production involves the transformation of labor, capital, land, and entrepreneurship into more valuable goods and services. Consumption is then the use of these goods and services to satisfy the wants and needs of people.Markets and GovernmentVirtually all economies accomplish this production-consumption task through a combination of decisions made through voluntary market exchanges and involuntary government laws, rules, and regulations. Capitalism is the term used for those economies relying predominately on markets, while communism and socialism are the names for economies coming down more heavily on the side of government decision making.
Recommended Citation:ECONOMY, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2024. [Accessed: April 19, 2024].
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BLUE PLACIDOLA
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Today, you are likely to spend a great deal of time wandering around the downtown area hoping to buy either a wall poster commemorating last Friday (you know why) or a country wreathe. Be on the lookout for defective microphones.
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Woodrow Wilson's portrait adorned the $100,000 bill that was removed from circulation in 1929. Woodrow Wilson was removed from circulation in 1924.
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"The past is a foreign country; they do things differently there." -- Leslie Poles Hartley, Writer
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IRR
Internal Rate of Return
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