Edited Invalid date
CHAPTER 9 -- Part 3: AGGREGATE DEMAND
The level of detail about macro outcomes is the key difference between the old and the new analysis.
The old aggregate-expenditure analysis focused on total spending, the product of output and prices.
The effects of macro instability on prices and real output are different in the newer AD analysis.
In a world where changes in both real output and price levels are important, the AD/AS framework is more useful.
Review flashcards and saved quizzes
Getting your flashcards
Privacy & Terms