Aggregate Demand and Aggregate Supply |
Aggregate Demand Curve | Short-Run Aggregate Supply Curve | Long-Run Aggregate Supply Curve |
Expectations | Commodity prices | Productivity |
Wealth | Nominal wages | Physical capital |
Size of existing capital stock | Productivity | Human capital |
Fiscal and monetary policy | Business taxes | Technology |
Net exports | | Quantity of resources |
Interest rates | | |
Investment spending | | |
Supply and Demand |
Demand Curve | Supply Curve |
Income | Input prices |
Prices of substitutes and complements | Prices of substitutes and complements in production |
Tastes | Technology |
Consumer expectations | Producer expectations |
Number of consumers | Number of producers |
Loanable Funds Market |
Demand Curve | Supply Curve |
Investment opportunities | Private saving behavior |
Government borrowing | Capital inflows |
Money Market |
Demand Curve | Supply Curve |
Aggregate price level | Set by the Federal Reserve |
Real GDP | |
Technology (related to money market) | |
Institutions (related to money market) | |
Foreign Exchange Market |
Demand | Supply |
Foreigners’ purchases of domestic | Domestic residents’ purchases of foreign |
Goods | Goods |
Services | Services |
Assets | Assets |
Note: It is the real exchange rate (adjusted for international differences in aggregate price levels) that affects imports and exports. |