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April 28, 2024, 01:51:14 pm
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Author Topic: Aggregate Demand  (Read 1231 times)  Share 

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insert

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Aggregate Demand
« on: April 13, 2014, 10:58:06 am »
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Why is investment in stocks not included in aggregate demand?

thanks
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abcdqdxD

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Re: Aggregate Demand
« Reply #1 on: April 15, 2014, 07:35:24 am »
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Quote from: insert on April 13, 2014, 10:58:06 am
Why is investment in stocks not included in aggregate demand?

thanks

because it isn't really a form of 'production' - nothing except digital certificates are being created.. stocks simply facilitate a flow of funds (i.e. transfer of money)
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chasej

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Re: Aggregate Demand
« Reply #2 on: April 15, 2014, 01:05:10 pm »
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Quote from: abcdqdxD on April 15, 2014, 07:35:24 am
because it isn't really a form of 'production' - nothing except digital certificates are being created.. stocks simply facilitate a flow of funds (i.e. transfer of money)

Stock market investment isn't a good or service either by definition.

Stocks and other investments are merely a way of using income (like savings but not) and isn't expenditure (i.e. demand for goods and services).
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