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Aggregate Demand - Coggle Diagram
Aggregate Demand
Net Exports
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if imports are higher, net exports are to be subtracted[negative figure] and vice versa
Investment
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Replaced investment: replacement of machines or their parts to increase their efficiency. Here the output is maintained.
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Share purchasing is not an investment in economics as: investment in economics means incvesting in capital that helps in further production, for ex: machinery.
Induced investment : investing purposely in machinery, etc to produce more or sell more. (If demand = more more induced investment)
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Government Expenditure
In 2019 the United States approved a budget of 686.1 billion in discretionary military spending. In 2019 the United States approved a budget of 686.1 billion in discretionary military spending.
Indian govt gave free vaccines. The cost incurred in providing cost-free healthcare is counted in government expenditure.This will increase the disposable income of people thus increasing aggregate demand.
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Government spending or expenditure includes all government consumption, investment, and transfer payments.[one sided]