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4 posts
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Hi I need some help here.
Can any1 tell me what's e meaning of potential demand/supply & what relation does it share wif aggregate demand/supply?
What full employment & full utilisation mean?Coz from what I've learnt, full employment is not equal to full utilisation.
Hence can I say that I fully employ all my resources of 100kg of flour to bake x amount of cakes. However I'm not able to bake x amount of cakes as my resources are not fully utilised???
Making me quite confused....
Pls advice, thanks!
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hmmm... I thought someone else would reply...
I forgotten quite a bit of my econs, but I will try
potential demand/supply & what relation does it share wif aggregate demand/supply?
Potential I guess means the demand/supply could be higher/lower. Aggregate demand/supply is the actual demand/supply at that point of time.
Example, like China, the potential demand for products is very high, but the aggregate demand might most likely be lower.
What full employment & full utilisation mean?
I not sure also... I think about it first...
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Aggregate demand is the total of expenditure of good and services in an economy.
Aggregate supply is the total of goods and services produced by an economy.
Full employment is defined as the full utilisation of labour and capital.
I don't know if you can apply macro definitions for micro issues.
Most of the time I don't know what people are asking. At first I thought it had something to do with PPC/PPF.
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