Aggregate Demand Curve

The Aggregate Demand (AD) Curve shows the total quantity of goods and services that all households, businesses, government, and foreigners are willing and able to buy at different price levels in an economy. It reflects the overall demand in the economy, which depends on factors like consumer confidence, interest rates, and income levels. When prices fall, people tend to buy more, increasing demand; when prices rise, demand generally decreases. The AD curve typically slopes downward, indicating an inverse relationship between price levels and total demand.