What Is the Difference Between a Movement Along the Aggregate

question 36

Essay

What is the difference between a movement along the aggregate demand curve and a shift of the aggregate demand curve? Explain in terms of what causes a movement and what causes a shift.

---

Definitions:

Translation Exposure

The potential for a company's financial statements to be affected by changes in exchange rates when foreign operations are translated into the parent company's currency.

Exchange Rates

The value of one currency for the purpose of conversion to another.

Purchasing Power

The buying power of a currency, measured by how many goods or services can be acquired with a single unit of that currency.

Imports And Exports

The act of bringing goods and services into one country from another (imports) and sending goods or services from one country to another (exports).