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Sagot :
In the as/ad model, the repercussion that a change in aggregate quantity demanded has on production and subsequently on income and expenditures is called the multiplier effect.
This downward slope shows that will increase withinside the charge degree of outputs result in a decrease amount of general spending. The graph suggests a downward sloping mixture call for curve, displaying that, because the charge degree rises, the quantity of general spending on home items and offerings declines.
The Aggregate Demand/ Aggregate Supply (AD/AS) version suggests the earnings willpower and charge levels. When productiveness will increase in an economy, the AS curve shifts downwards to the proper displaying a growth withinside the mixture output and a lower withinside the charge degree.
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