L02 Discuss how best to inuence policy goals such as economic growth, price stability, fully employment and the attainment of a sustainable balance of payments. Aggregate demand (AD) refers to the amount of total spending on domestic goods and services in an economy. It includes four component of demand which are consumption, investment, government spending and nets export. The demand is determining by a factor but one of them is the price level. Aggregate supply (AS) refers to the total quantity to supply based on the prots they expect to earn. They determine prots, in turn by the price of the outputs they sell and by prices of the inputs like labour or raw materials, they need to buy. Before MCO During MCO After MCO (RM billion) (RM billion) (RM Billion) Consumer Consumption (C) Firm Investment(I) ... Aggregate Supply 343.7 Government Spending 54.7 (G) 85 Discussion Question: 1. Calculate the Aggregate Demand before MCO, During MCO and after MCO 2. Draw the Aggregate Demand Curve by using one graph. Show the movement of the graph 3. Discuss the reasons Aggregate Demand and Aggregate Supply curve changes