fore spee of micro micro AG fore foree forgate simply agregation of for microeconomic model e in of quantity of output a single industry this mod represents the quantity out output of an entire qu of the Quan of product quty of output entire economy National fores for two sides of foreign okay these are the two Force which operate on the micro economy they are important TOS of explain the Maj economy tronomy movement determine the level of overall overall economic activity the overall economic [Laughter] demand eom activity eom economy particularly theel of output you see the level of what output or the level of product price through interaction interaction AG agregate concept of aggregate demand is refer to the total amount of that different sectors in economy willing willing willingly spending of theod am different sectomy Amal amount of expend for this because measure by total expenditure you see this because this because measuring by total expend of economy community on the good of service on the demand Define us the total amount of money which all section the total amount of or which is amount of M are ready to what spend off the purchasing of good or service am service produce an economy during the given period of or the given year okay [Laughter] bying which is depending on of price as well as the monetary policy Physical policy and other factors [Laughter] for depending is the total spending by all the entity of the economy okay which entity entity means the customer the business and it is the total spending by all entities in economy by all the customers the business and the government in the economy moreover we may say aggate demand is the total expenditure of the consumption and okay there are four major component oftion of private investment for service minus for compon fore speech [Laughter] [Laughter] spee forch consumption of household consumption investment private investment government expenditure demanded by disposal income which is personal income less task household weals long ter of trending income and agregate prices in [Laughter] foree speech for the fure pending include private purchasing of structure teyan the major determin investment investment the cost of the capital the capital means what equipment okay advanc ofy the cost of capital expectation about the fure the future foree spee agreement the government purchase is a good of service through component of ad is deter directly by the government spending of the decision component the value of export minus to the value of export youed by for relatively price and exchange of rate fore exchanging Rel price relative price relative exchange of comp comp foreign fore foreign spee sing for demand Cur is a schedule that shows the amount of real output that buyer collectively desire purchase at each price l c c par for am of real output that buyer of collectively desire to purchase at each price of collectively desire to purchase at each price of the relation between the price level and the GDP demand is inversely or negative [Laughter] proportion for with other Factor H constant agregate demand and Rise which failing the general price level for in price also this C is down it indicates the output of good service the output or the product of good service which is will be demand in the economy at various general price product which be foreign spee for Dom shows shows that when the general price level fail you you see you price theate quantity of demand of the output there is invers Rel between the general price for SL down what's the reason what's the reason of behind why asking why slow down the same asking why the UN invers Rel between the price and quantity demand okay leadership result down SL demand cures explained by the balance effect bance effect interest rate and international trade for for balance effect that the relation between the price Liv and the quantity demand of real GDP established through changing of the value of monetary and foreign spee the of the price of CA rise to the price of level cause purchasing power is fail the of the price ofre the person for example a person with lessance effectance forch fore another name of interesting of effect we call it the rising of the price within a fixed Min Supply the r of the price of the fixed other things be equal to produce deine the spending and produce to the relationship between the price level the quantity demand of GDP is established through the changing house the business spending that business for higher price increase high price of many they give fix supply of many fix fix fix Supply and increasing of many demand will be drive up the price paid for it is us so pric interest rate interesting investment spending consumption of interest of the price investment spending [Laughter] consumption affecting 6% of rate of return on the potential purchase of capital we find that the investment potential profitable when the interest rate is 5% of return but the investment of will be unprofitable will not be made with the interest it has right to foreign spee r customer may decide not to purchase a new houses a new automobile when is the interest Lo reling of the demand of money consequently the interest rate is higher price reduce the amount of R output demand output demand interational trade effect interational trade effect domes interational trade effect St the inverse of relationship between price level and quantity demand of gpal between the price price through the forign sectoring the price ofan R this happen ethopian Goods became Rel more expensive than foreign this service for because of what rising of what rising of price due to this the quantity of demand GP foreign okay number for changing of quantity GP changing of the price of Focus changing price for you see as the price ofel fa the quantity of demand rise demand GDP represent as a from one point to another along fore spe demand GDP represents the movement of 1 demand demand curve the cve for changing of aggregate demand is Shifting aggregate of demand C from ad ad1 to okay for changing quty price of PR right shifting cve from A1 to a try to notize Noti all that when aggregate demand curve shift quantity demand of GP changes through the price level remain Conant any positive changes this Factor the right shift to negative change shift C left shift upward down right right shft inome people Liv of economy activity in other country determine of export Ava eom of inome for the people forevel of econom activity other country theel of activ economy [Laughter] changing okay kind of variable that lead to shift demand upward downward in other words we can cause demand rise what can because it is f simp this question demand Chang spending serviceing what okay for example spending of increase a given price Dem is if the spending of decreasing the given price demand is fa individuals of government want to BU more ethopian good or service even though the price this Goods have not change then we say that the demand is increased inre sh right of course when is individual fous government want to buy fan government service at given price level they say the government events decline as shft indidual of government want to given in short the rising consumption in investment government purchase next expert will be incre of good of service consumption investment ining of simar failing consumption okay we know we now now what cause total expenditure of good service to change we can relate the component of spending to Ean agregate demand we can relate the component of spending if at a given price level consumption investment government purchase or export export is Rise demand is rise for speech given price level consumption investment government [Laughter] purchase given price at a given price or price are two ceg of areeg of DET factors with factors AG ex exogenous exogenous variable which are determined outside ad AC framewor demand and supply framewor Advan policy variable under government control exous exogenous variable which are determined outside of the ad AC framewor factors okay in this we will look at some of the factors some the factor of that changing consumption investment uh changing consumption changing of investment change of government spending change of n demand the Su of consumtion the Su of investment the of government spend ofp investment fore speee import export fore