There are three distinct reasons why the aggregate demand curve slopes downward.  List and discuss each reason.   The aggregate supply curve can be upward sloping or vertical depending upon the time frame we are considering (short-run or long-run).  In what time frame is the aggregate supply curve vertical?  Why?  In what time frame is the aggregate supply curve upward sloping? Why?

Q: Determinants of aggregate demand The following graph shows a decrease in aggregate demand (AD)…

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A: Sticky-Wage Theory: the sticky wage theory exhibits that the wages of the laborer remain unchanged…

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Q: The following graph represents the short-run aggregate supply curve (SRAS) based on an expected…

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