00:01
Okay, so let's consider what some of the differences are between the aggregate demand curve and say a demand curve for an individual product, such as apples.
00:11
Now, the first thing we want to realize is that the aggregate demand curve shows the relationship between the price level and quantity of real gdp demanded by households, firms, and government.
00:22
So essentially, it's a very macro -level looking graph.
00:25
On the other hand, the demand curve for apples just narrows that down to the price of apples and the quantity.
00:31
To demand it of apples on the axes.
00:34
The second reason, the second difference between the two curves is to do with the fact that they're both downward sloping.
00:41
And they're both downward sloping, but for different reasons.
00:44
Now, the aggregate demand curve is downward sloping due to three things, the wealth effect, the interest rate effect, and the international trade effect...