Word of the Day

Aggregate Demand

Total planned demand for goods and services produced within the economy over a given time period.

Components of AD are:
AD = Consumption + Investment + Government Spending + (Exports - Imports)

A fall or rise in any of the components of AD will cause AD to fall or rise respectively.

Exchange Rate Presentation

I know that exchange rates (as interesing as they are!) can sometimes be very difficult to get your head around so this powerpoint I made should help set things out clearly. It explains the exchange rate mechanism from freely floating to (rigidly) fixed as well as outlining the advantages and disadvantages of them.

Presentation here