The document outlines the aggregate demand and aggregate supply model. It discusses: - The aggregate demand curve shows price-output combinations where goods and money markets are in equilibrium. It is derived from the IS-LM framework. - Fiscal and monetary policies can shift the aggregate demand curve by impacting income, spending, and the money supply. - The aggregate supply curve explains production and pricing. In the short-run it is upward sloping, but in the long-run other factors adjust and it is vertical. - The intersection of aggregate demand and supply determines equilibrium output, employment, prices in the short-run. In the long-run, aggregate supply is the main determinant of economic growth