Economics: question for any AS Economics guys out there

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username1310825
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How does a change in the savings ratio affect aggregate demand?
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TSR Jessica
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Sorry you've not had any responses about this. Are you sure you've posted in the right place? Here's a link to our subject forum which should help get you more responses if you post there.


Just quoting in Fox Corner so she can move the thread if needed :wizard:
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nadiakms
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If people start to save more, they consume less so there is less aggregate demand. If they were to spend more and save less, consumption increases resulting in an increase in aggregate demand as consumption is one of the components of AD (C+I+G+(X-M)), the 'C'.
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