Suppose that Wakanda imports decrease and exports increase. holding consumption, investment, and government spending constant, Consumption, investment, and exports all increase would happen to aggregate demand.
An example of this happening in the economy is when interest rates are cut. When interest rates fall, people are more likely to borrow to start or expand their businesses, increasing capital expenditures. This increase in capital spending will lead to an overall increase in aggregate demand.
Aggregate demand is the total amount of goods and services in the economy that consumers are willing to pay for over a period of time. Aggregate demand is calculated as the sum of private consumption, business investment, government spending, and the difference between imports and exports.
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