R
rinishj28
Member
The textbook says that if a firm invests more it increases aggregate demand and hence they respond to this increase in demand by using more labour and other resources hence paying out more incomes to households.
How can investment increase aggregate demand?
Shouldn't it be the other way around?
Mathematically it makes sense if I go by the formula AD= C+I+G+X-M
However it doesn't sink in otherwise
How can investment increase aggregate demand?
Shouldn't it be the other way around?
Mathematically it makes sense if I go by the formula AD= C+I+G+X-M
However it doesn't sink in otherwise