'Aggregate Demand and Supply Models Essay\r'

'As it stands currently the existing return of the economic factors on summationd demand and contribute atomic number 18: un date, consumer income, and interest rates. In this paper we mention the existing effect of the economic factors on come demand and supply. The American people have petty to no income when unemployed, this in turn causes a come down in demand for the economy. This event of event causes the aggregate demand to curve to the left. One of the main reasons unemployment stiff high to this day is the lack of demand. A shortfall in aggregate demand is precisely the type of issue that can be addressed by monetary policy, however, to do so we need never-ending monetary stimulus to progress toward maximum employment stability. The crash of the housing market has set horrendous limitation on consumer and their disbursement. Sternness on behalf of the judicature to a certain extent has decreased aggregate demand during this recovery period. These actions have directly wedged growth. What this means to us is that lower governing body spending and higher taxes call for disposable income for consumers, work for government contractors diminishing, and a decrease in government payroll. some(prenominal) other factor that has had great effect and impact are the levels of uncertainty. The events leading to this state have yet to be resolved which in turn have caused a lack of willingness and confidence within consumers. In the reservoir the levels of uncertainty reflected the force of influence the recession had on us as consumers. This is something that had not been experienced in several years which made it difficult for us to handle or even find a way to get by in a more successful demeanor. After extensive look and analysis it is safe to say the supply-side considerations explain some of the rise in unemployment, which once again actualize the lack of demand as well as the fact that the economy is suffering first and frontmost of a we ak demand rather than a shortage of supply.\r\nReferences\r\nWilliams, J. C. (2013, February 25). The Economy and Fed Policy: constitute the Demand. Federal Reserve Bank of San Francisco. Retrieved from http://www.frbsf.org/economic-research/publications/economic-letter/2013/february/economy-fed-policy-follow-demand/\r\nThoma, M. (2012, March 28). Demand, not supply, is restraining the economy. CBS News. Retrieved from http://www.cbsnews.com/8301-505123_162-57405230/demand-not-supply-is-restraining-the-economy/\r\n'