Final answer:
The correct equation that represents the aggregate demand curve is a. AD = C + I + G + NX, incorporating consumption, investment, government spending, and net exports.
Step-by-step explanation:
The aggregate demand curve is best represented by the equation AD = C + I + G + NX. In this context, C stands for consumption spending, I denotes investment spending, G is government spending, and NX represents net exports, which is calculated as spending on exports (X) minus imports (M). Therefore, the correct option that represents the aggregate demand equation is AD = C+I+G+ NX.
Shifts in the AD curve can be caused by changes in these components. An increase in any of the components C, I, G, or X-M can result in a rightward shift, leading to higher levels of aggregate demand at each price level. Conversely, a decrease in any of these components will cause the AD curve to shift to the left, indicating a lower level of total spending at each price level.