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Smart Reasoning:

C&E

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Qaagi - Book of Why

Causes

Effects

An increase in consumer confidencecausesan increase ( rightward shift ) of the aggregate demand curve

This shift back in the IS curvealso causesthe aggregate demand curve to shift back

most likelyto causea shift to the right in the aggregate demand curve

Obviously , aggregate supply must have shifted leftcausingupward movement along the aggregate demand curve

A decrease in consumer confidencecausesa decrease ( leftward shift ) of the aggregate demand curve

incomes of the workers ... workerswill causea leftward shift in the aggregate demand curve AD

the factorscausea shift in aggregate supply curve

factor other than price such as(passive) is caused byShift in the demand curve

to spendthereby causingthe aggregate demand curve to shift left

The increase in investmentcausesan increase in the aggregate demand curve

these other determining factorscausea shift in the aggregate supply curve

changes in the demand determinants and shifts in the supply curve by changes in the supply determinants(passive) are originated byShifts in the demand curve

Factorscausea shift in the aggregate demand curve Q

Shift Factors of Demand Shift factors of demand ... factorscauseshifts in the demand curve

The recessionhas causedthe demand curve to shift in

increases or decreases in price(passive) are caused byMovements along the aggregate demand curve

an important factorcausesa shift in aggregate supply curve

price variations from products in the market and these changes(passive) are caused byMovements along the aggregate demand curve

What factorscan causeshifts in the demand curve

the reduction in the consumptioncausingdownward shift in the aggregate demand curve

the consumptioncausingdownward shift in the aggregate demand curve

However , in property markets the nonprice determinants of demand change frequently therebycausingshifts in the demand curve

An increase in spending that is NOT caused by a change in the price levelcausesthe aggregate demand curve to shift

increase in money supply ( Mwill causea rightward shift in aggregate demand curve

An increase in the money supplycausesa rightward shift in the aggregate demand curve

increase in money supplyleadsto rightward shift in aggregate demand curve

Changes in consumer spending also change expenditurecausesa shift in the aggregate demand curve

this non - price factorscausea shift in aggregate demand curve

AGGREGATE DEMAND SHIFTS Changes in the aggregate demand determinantscausethe aggregate demand curve to shift

> AGGREGATE DEMAND SHIFTS Changes in the aggregate demand determinantscausethe aggregate demand curve to shift

SHIFTS Changes in the aggregate demand determinantscausethe aggregate demand curve to shift

Changes in any of the aggregate demand determinantscausethe aggregate demand curve to shift

Changes in the aggregate demand determinantscausethe aggregate demand curve to shift

non - price - level factorscan causea shift in the aggregate demand curve

The increase in aggregate demandleadsto a shift in the aggregate demand curve

a change in any of the components of aggregate demandcausesa shift in the aggregate demand curve

The factors ... Change in consumer spending 2causea shift in the aggregate demand curve

when there was a decrease in aggregate demandcausinga shift of the aggregate demand curve from

A change in any of these determinantscausesa shift of the aggregate demand curve

What factorsmight causethe aggregate demand curve to shift

a shift in AD Changes in Expectationscausinga shift in AD Changes in Expectations

both the equilibrium level of output and the price level to risecausesboth the equilibrium level of output and the price level to rise

from a change in priceresultsfrom a change in price

from a change in priceresultsfrom a change in price

the equilibrium quantity to increase and the price to risewill causethe equilibrium quantity to increase and the price to rise

quantity demandedinfluencesquantity demanded

to a greater real GDP and to upward pressure on the price levelleadsto a greater real GDP and to upward pressure on the price level

for examplecausedfor example

into increased equilibrium priceswill resultinto increased equilibrium prices

output and income to increasecausingoutput and income to increase

The fall in the price(passive) must have been caused byThe fall in the price

A recession(passive) is caused byA recession

stimulus ( either fiscal or monetary(passive) is designedstimulus ( either fiscal or monetary

in movement along the supply curve from the point ( Q 1 , P 1 ) to the point ( Q 2 , P 2resultedin movement along the supply curve from the point ( Q 1 , P 1 ) to the point ( Q 2 , P 2

a shift in the supply curve cause a change in the quantity demanded or suppliedcausea shift in the supply curve cause a change in the quantity demanded or supplied

Movement along the demand curve(passive) is caused byMovement along the demand curve

in movement along the supply curve from the point ( Q , P ) to the point ( Q , Presultedin movement along the supply curve from the point ( Q , P ) to the point ( Q , P

national output to fallcausingnational output to fall

to a movement along the supply curveleadsto a movement along the supply curve

the equilibrium to shift to point B.causesthe equilibrium to shift to point B.

equilibrium pricewill causeequilibrium price

in fall in GDPresultingin fall in GDP

in a higher price , and a higher quantity ? soldwill resultin a higher price , and a higher quantity ? sold

wages to risecausingwages to rise

to an increased price , which increases producer surplus from area A to area A + B + C. Problems and Applications 1leadsto an increased price , which increases producer surplus from area A to area A + B + C. Problems and Applications 1

in movement along the supply curve from the point ( Q1 , P1 ) to the point ( Q2 , P2resultedin movement along the supply curve from the point ( Q1 , P1 ) to the point ( Q2 , P2

to an increased price , which increases producer surplus from area A to area A + B +leadsto an increased price , which increases producer surplus from area A to area A + B +

in higher price levelresultsin higher price level

a movment along the supply curvewill causea movment along the supply curve

excess demandcausesexcess demand

in a higher pricewill resultin a higher price

business cycles(passive) were caused ... bybusiness cycles

to an increased price , which increases producer surplus from area A to area A + B + C. Figureleadsto an increased price , which increases producer surplus from area A to area A + B + C. Figure

in an increase in the interest rates See graph ( a ) on next slide Sourcethen will resultin an increase in the interest rates See graph ( a ) on next slide Source

demand - pull inflationcausesdemand - pull inflation

to an increased price , which increases producer surplus from area A to area A + B + C. Share with your friends : 1 leadsto an increased price , which increases producer surplus from area A to area A + B + C. Share with your friends : 1

to an increased price , which increases producer surplus from area A to area A + B + C. Figure 7 - 7leadsto an increased price , which increases producer surplus from area A to area A + B + C. Figure 7 - 7

examplescausesexamples

the equilibrium real GDP to increased and equilibrium price level P to risecausingthe equilibrium real GDP to increased and equilibrium price level P to rise

a movement along the aggregate supply curvewould causea movement along the aggregate supply curve

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Smart Reasoning:

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