Summary

Aggregate demand shows the total amount of expenditure in the economy

Aggregate supply shows the total amount supplied in the economy at each price level AD = C + I + G + (X-M)

Any change in the determinants of Aggregate demand will cause the AD curve to shift

In the short term shifts in the AD curve can cause an increase in national income

The long run aggregate supply curve is vertical

If LRAS increases the curve shifts out and economic growth has occured