The paper "Analysis of Portugal Economic" is a perfect example of a micro and macroeconomic case study. Portugal, a member of the European Union, has a mixed nature economy and substantively functions as a high-income country. Most of the imports in the country come from the EU and largely from Spain, Germany, France and the United Kingdom. The exports also involve other EU member states. The currency for the country is the euro and has been a member of the Eurozone since it was incepted. AGGREGATE DEMAND AND SUPPLY The aggregate demand substantiates the overall demand for goods and services in the entire economy.
It substantiates a macroeconomic term that heightens a relationship between everything purchased and sold within the country. Thus, the aggregate demand equals the Gross Domestic Product in the economy GDP substantiates a nation's total economic output every year. It's equivalent to what is being spent in the economy of the country. The formula to calculate the elements of Aggregate Demand is AD (GDP) = C + I + G + X. That stands for: Y (GDP) = Consumption + Investment + Government + X (net exports, or exports minus imports. ) Explanation of the components of GDP Personal Consumption Expenditures. The consumers spend on what is produced and include goods and services.
Goods are subdivided into durable goods that include automobiles and furniture while non-durable goods comprise of food, clothing and fuel. Services produce 74% of the Portuguese economy and provide 65% of jobs to the working population. Business Investment Business investment substantiates the purchases that the companies make to produce consumer goods. However, where a purchase is made to replace an existing item, it does not add up to the GDP.
Thus, an increase in private inventory makes a contribution to the GDP. A decrease in orders in inventory means that businesses are experiencing a fall in demand. As the inventories build up, companies cut back their production and if it continues for long people eventually lose their jobs.
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