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Aggregate Demand

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PPGPortal > Home > Concept Dictionary > A > Aggregate Demand
Aggregate Demand 

The total market demand for a particular good

(Dwayne Benjamin, PPG 1002)  


Aggregate demand for a good usually depends on prices and the distribution of incomes. For much microeconomic analysis, it is convenient to think of aggregate demand as the demand of some “representative consumer” who has an income that is just the sum of all individual incomes.

An aggregate demand curve shows the quantity of goods and services that the market will demand at each different price level. The aggregate demand curve slopes down and to the right because at a lower price level, all else equal, more output is demanded from the economy in the short run.



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