CH 17 ECO 336
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Created by:
PaigeFleming on April 27, 2011
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12 terms
Terms | Definitions |
|---|---|
 aggregate demand | the relationship between total quantity of goods and services demanded by all sectors of the economy and the price level |
| wealth effect | the effect of a change in wealth on consumption |
| interest rate effect | the effect of a change in the interest rate on consumption |
| international substitution effect | the effect of changes in the domestic price level on the consumption of domestically produced goods relative to foreign produced goods. |
| change in aggregate demand | a shift of the aggregate demand curve |
| aggregate supply | the relationship between total quantity of goods and services that an economy produces and the price level |
| change in aggregate supply | a shift of the aggregate supply curve |
| exchange rate shock | a large change in the real value of a country's currency that occurs in a short period of time |
| income elasticity of demand for exports | the responsiveness of exports to changes in foreign income |
| price elasticity of demand for exports | the responsiveness of exports to changes in the real exchange rate |
| income elasticity of demand for imports | the responsiveness of imports to changes in domestic income |
| price elasticity of demand for imports | the responsiveness of imports to changes in the real exchange rate |
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