Buy custom AGGREGATE DEMAND AND SUPPLY
Essay's paper info
| Topic: |
Business
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| Number of pages / Number of words: |
7 / 1949 |
Essay's paper body
They argue that the demand for money is dominated by the speculative rnotive. This is interest elastic so that an increase in demand for money will cause only a small rise in the rate of interest. In their view the main influence on both consumption and investment is income and not the rate of interest...
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The implication of the aggregate demand curve being steep is that a change in the general price level will not significantly alter aggregate demand.
In contrast new classical economists believe the aggregate demand curve is shallow, they think the main component of the demand for money is the transactions demand...
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