Introduction/Possible Activities:
Aggregate demand is the sum total of demand for all businesses, people, and the government in an economy. Aggregate demand measures how many goods and services demanded by an economy as a whole. Economists can graphically represent the AD curve and later you will learn how the government can diagnose and help an economy depending upon the problem using ways of shifting aggregate demand. What is aggregate demand? How can the government shift aggregate demand? By how much can aggregate demand be shifted?

A. Students will demonstrate an understanding of the composition and principles of aggregate demand by:
1. Defining aggregate demand (AD).
2. Listing the different components of AD.
3. Classifying situational changes to the determinants of AD.
a. Defining investment demand.
c. Explaining the impact of the interest rate on investment component of AD.
4. Explaining the reasons the AD curve is downward sloping.
5. Contrasting the AD curve from individual and market demand curves.
6. Differentiating between movement along and shifts of AD.
7. Showing movements of and shifts in AD on a graph with proper labels.

Learning Activities:

1. Watch the video below and take notes.

2. Answer these questions while you watch the video above:
-What is aggregate demand?
-Graph AD
-Why is AD downward sloping? (3 reasons, and explain)

-Why is AD downward sloping?
-What does the AD curve represent (definition)?