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Aggregate Demand (AD) refers to the total quantity of goods and services demanded across all levels of an economy at a given overall price level and in a given period. The AD curve is downward sloping, indicating an inverse relationship between the price level and the quantity of output demanded. One of the key components of aggregate demand is government spending, represented as G in the equation: AD = C + I + G + NX, where C is consumption, I is investment, G is government spending, and NX is net exports. A change in government spending directly affects the AD curve. When the government increases its spending on goods and services, holding all other components constant, the aggregate demand curve shifts to the right. This is because higher ________ _________ _______ ___ _____ ____ _________ ____ _________ ______ ____ _____.
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