文档介绍：Chapter 6
Aggregate Supply、Aggregate Demand and Price Adjustment
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Chapter 1
Topics to be Discusses
Aggregate Demand (AD) Function
Aggregate Supply(AS)Function
AS-AD Model
Price Changes and Determination of Output
Price Adjustment Process
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Chapter 1
Aggregate Demand:the gross demand for production and service under a given price level.
AD Function:the relationship between aggregate and price level,or the quantitative relations between general price level and social equilibrium expenditure.
AD Function
3
Chapter 1
AD Function
AD Curve
From the angle of aggregate expenditure:
Price is P0,Aggregate expenditure is AE0
Price is P1,Aggregate expenditure is AE1
AE
E’0
Y
Y0
AE0
AE1
Y0
Y
P
P0
Y1
Y1
AD
P1
E0
E1
O
E’1
O
Figure 10-6
Why is the AD Curve downward sloping?
Interest Effect: P Md R I AE and Y
Real e Effect: P Wealth C and I AE and Y
Taxation Effect: P Wage T Yd C and I AE and Y
Import-and-export: P X ,M I AE and Y
AD Function
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Chapter 1
AD Function:ary Policies and AD Curve
R
Y
Y
R1
Y1
IS1
P
LM1
Y1
AD1
P1
Increase nominal money supply at the equilibrium point (R1, Y1)
LM2
1.
LM Curve shifts down to LM2,and under the same price level
P1output increases to Y2
Y2
R2
Y2
2.
2.
AD Curve shifts to AD2
AD2
3.
Figure 10-7
R
Y
Y
R1
Y1
IS1
P
LM1
Y1
AD1
P1
Increase government purchase at the equilibrium point (R1, Y1)G
IS2
1.
IS Curve shifts to IS2. and under the same price level output
increases to Y2
Y2
R2
Y2
2.
2.
AD curve shifts to AD2
AD2
3.
AD Function:Fiscal policies and AD curves
Figure 10-8
AD Function:IS-LM Curves and AD Curves in Short or Long Term
IS-LM:
Short term (Keynesian): given P = P1,solve r and Y。
IS-LM for a given price level
Long term (Classical): given Y = YLR solve r and P。
LRAS and AD curves
Chapter 10-5
AS Function
Determi