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Question : Which of the following is not a component of aggregate demand?

Option 1: Consumption expenditure
 

Option 2: Investment expenditure
 

Option 3: Government expenditure

 

Option 4: Savings


Team Careers360 8th Jan, 2024
Answer (1)
Team Careers360 11th Jan, 2024

Correct Answer: Savings


Solution : The correct answer is (d) Savings

Savings is not considered a component of aggregate demand. In the context of macroeconomics and aggregate demand, savings represent the portion of income that is not spent on consumption or investment. While savings play an important role in the economy, they do not directly contribute to aggregate demand, which is focused on the total spending or expenditure on goods and services within an economy.

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