Determinants of aggregate demand

The following graph shows a decrease in aggregate demand in a hypothetical country. Specifically, aggregate demand shifts to the left from AD1to AD2, causing the quantity of output demanded to fall at all price levels. For example, at a price level of 140, output is now $200 billion, where previously it was $300 billion.

Note: Review the graph and then fill in the table that follows.

The following table lists several determinants of aggregate demand. Complete the table by indicating the change needed in each determinant to decreaseaggregate demand.

Determinant Change Needed to Decrease Aggregate Demand

Consumer Confidence _________________(Increase/Decrease)

Government Purchases ________________ (Increase/Decrease)

Interest Rates _________________(Increase/Decrease)

Incomes in Other Countries _________________(Increase/Decrease)