macroeconomics

1. Demand &
Aggregate
Supply
IlmaUniversity(MainCampus)
Group Members:
Muniba Hashim
Ahsan
Ahmad Sahil
Mohsin
Behroz
Presentation submitted to:
Miss ……

2. Aggregate Demand And
Aggregate Supply

3. Aggregate Demand
In economics aggregate demand is the total demand for final
goods and services in the economy at a given time and price
level.
Aggregate demand is the gross domestic product of a
country when inventory levels are static

4. Aggregate Demand
• Formula:
AD = C+I+G+(X-M)
C= Consumption Spending
I = Investment Spending
G = Government Spending
(X-M) = difference between spending on imports and receipts
from exports (Balance of Payments)

6. Aggregate Demand
Curve
• The aggregate demand (AD) curve is a curve that shows the
negative relationship between aggregate output (income) and
the price level

8. Aggregate Supply
• Aggregate supply is the total supply of goods and
services in an economy.
• Since Y=C+S, We may state that AS= C+S

9. Componenets Of
Aggregate Supply
• C = Consumption which is always positive
• S = Saving as a component of Y may be negative when
the level of income is low.

10. Aggregate Supply
Y
(Income)
C
(consumption)
S Saving)
Y-C=S
AS(C+S)
0 20 -20 0
20 25 -5 20
40 40 0 40
60 45 15 60
80 50 30 80
100 55 45 100
120 60 60 120