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Question

Aggregate demand consists of consumption and investment demand.

A
True
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B
False
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Solution

The correct option is A True
True. Aggregate demand consists of consumption and investment demand. Aggregate demand is the demand of total goods and services in the economy as it is impossible to count all the physical quantities the total expenditure on all goods and services are taken into account. Aggregate demand consists of expenditure on household consumption, Private investment, Government expenditure on consumption and investment and imports and exports.

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