Aggregate demand and aggregate supply

The circular flow of income

• The '2-sector' model
• The '3-sector' model
• The '4-sector' model

The '45 degree' diagram

• The consumption function
• The MPC and the multiplier

Aggregate demand

• The aggregate demand curve
• Why is the AD curve downward sloping?
• Shifts in the AD curve

Aggregate supply

• The short run AS curve
• Shifts in the short run AS curve
• The long run AS curve

Supply side policies

• What are supply side policies?
• Why monetarists like supply side policies
• The Keynesian view

Test It

Now you have learnt the main principles, test yourself with these sample questions. If you get stuck, go back and review the principle again.

Coming Soon