Question

Total planned real expenditures measured along the aggregate demand curve are made up of

Answer 1

Total planned real expenditures along the aggregate demand curve in an economy include consumption, investment, government spending, and net exports. The aggregate demand curve depicts the total spending on domestic goods and services at each price level, affected by changes in the price level measured by the GDP deflator.

Step-by-step explanation:

Total planned real expenditures measured along the aggregate demand curve comprise several key components of an economy's spending. These components are consumption, investment, government spending, and net exports, which is calculated by subtracting imports from exports. The aggregate demand reflects how much money all of these activities represent at various price levels, illustrating how a change in the general price level impacts overall spending.

The aggregate demand curve thus shows the relationship between the price level - indicated by an index number such as the GDP deflator - and the total amount of goods and services that households, businesses, the government, and foreign buyers are willing and able to purchase at each price level.

Answer 2

Total planned real expenditures measured along the aggregate demand curve are made up of consumption spending, investment spending, government spending, and net export spending.

To add, components of aggregate expenditure are defined as the total amount that firms and households plan to spend on goods and services at each level of income.