- How does the interest rate effect explain the slope of the aggregate demand (AD) curve?
- How does the wealth effect explain the slope of the aggregate demand (AD) curve?
- What is the difference between a movement along the aggregate demand (AD) curve and a shift of the aggregate demand curve? Explain in terms of what causes a movement and what causes a shift.
- What happens to investment spending when the price level rises? Explain and illustrate using a loanable funds market graph.
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The slope of the aggregate demand (AD) curve
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