What Effect Does a Change in Expectations by Households and Firms

question 134

Essay

What effect does a change in expectations by households and firms have on the aggregate demand curve?
_____________________________________________________________________________________________
_____________________________________________________________________________________________

---

Definitions:

Strategic Contingency Theory

An explanation of sources of power suggesting that units best able to cope with the firm’s critical problems and uncertainties acquire relatively large amounts of power.

Selling Company Assets

The process of disposing of company-owned assets, either to generate cash in financial distress or to streamline operations.

Power

The ability to influence or outright control the behavior of people, environments, or situations.

False Catastrophe

An exaggerated or fictitious disaster or crisis, often used to manipulate public opinion or achieve certain outcomes unduly.