Question : Effective demand refers to that level of aggregate demand which becomes effective because it is equal to aggregate supply.
Option 1: Aggregate demand
Option 2: Aggregate supply
Option 3: Effective demand
Option 4: None of the above.
Correct Answer: Effective demand
Solution : Effective demand refers to that level of aggregate demand which becomes effective because it is equal to aggregate supply. Hence, Option C is correct.
Question : It refers to a situation where the aggregate demand is equal to aggregate supply at full employment level.
Question : It refers to a situation when demand is equal to aggregate supply beyond the full employment level. It occurs after the full employment level.
Question : It refers to a situation with the aggregate demand is equal to aggregate supply when the resources are not fully employed. It generally occurs prior to full employment level.
Question : Aggregate supply refers to __________________.
Question : __________________ refers to the situation in aggregate demand is less than the aggregate supply in the economy.
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