Reference no: EM13724831

Responses must be original and 60-100 word

1. The future forces that could decrease aggregate demand include forecast, expectations, plans, outlook and projections with respect to future matters. This includes trends in results of operations, margins, growth rates, overall market trends, the impact of interest or exchange rates and tax rates. Global or regional downturns, increased competitive product and pricing, lagging behind in the market, growth, pricing, unfavorable innovations changes in consumers preferences in taste, demographic trends, health related issues (the decision to stop drinking, which I do not drink) , etc...., layoffs, technology development that may affect distribution of the products, sales, distributors, cost, leadership and performance.

2. If interest rates were to increase and banks were to require a larger upfront down payment in order to purchase a home, the aggregate demand could potentially decrease. In addition, if the unemployment rate were to increase this would also have a negative impact on the aggregate demand of the real estate industry. If individuals were to lose their source of income they would most likely no longer have the means to afford a home. In addition, those who had recently purchased a home for less money down would also most likely not be able to afford their mortgages because more money will have been financed causing a higher monthly payment.

3. If we are talking about setting prices or determining output even in a very large company such as an oil or steel producer wouldn't this be considered a microeconomics issue? Also, wouldn't such aggregate issues as inflation, national employment levels or the growth of GDP be macroeconomics.

4. "The production possibilities model is a table that lists the trade-offs between two choices" Relate this to something if your life and explain.