Aggregate Demand is the sum of all demand in the economy, , Aggregate Supply is amount of goods and services produced in a country within a certain amount of time, , Aggregate Demand is equal to Consumption + Investment+ Government Spending+ net Exports , , Consumption is all household spending on goods and services, , Investment consists of firms spending on new plant and machinery, , Government spending includes spending on infrastructure and current spending on wages of government employees, .

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