Reduced optimism from the business world.
- Demand shocks ( efterfrågestörningSwedish )
- Business world ( näringslivetSwedish )
- GDP*, y* = potential GDP
- LAS, LRAS = ( Long-term Aggregate Supply ) , ( Long-run Aggregate Supply )
- AD = Aggregate Demand
- e = Optimism
- R = Interest rate
- I = Investment
- ( Md/P ) = Money Demand
- ( Ms/P ) = Money Supply
- E = Exchange rate ( växelkurs, valutakursSwedish )
- X = Net exports ( exports - imports )
Generally aggregate demand AD is affected by:
- [ Human factor ] - Fiscal and monetary policy.
- [ Demand shock ] - Sudden and unexpected recession/economic downturn in the surrounding world.
- [ Demand shock ] - Decreased optimism in the business world.
- e↓ => I↓ => y↓ => IS-shift => ( Md/P ) ↓ => ( Md/P ) < ( Ms/P ) =>
- R↓ => I↑
E↓ => X↑