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The article describes how unemployment in Argentina has dropped below 7% for the first time in a long time. The decreased unemployment is due to an increase in the country's exports and an increase in national aggregate demand. Both of these things would cause an increase in aggregate supply, which in result would increase the aggregate supply of labor, causing the unemployment rate to decrease. However, this is only seen as a short term change, as the export are expected to decrease due to the economic crisis in Europe, and the increasing movement of production to china, and the growing competition from Chinese produced goods, because of the cheaper prices. This would cause aggregate demand in Argentina to decrease, which would cause a response from the short run aggregate supply, in the form or a decrease. This would again cause the aggregate supply of labor to fall back down again, resulting in the unemployment rate rising again.

According to this article, Germany's unemployment had increased for a fifth month in august. The unemployment rate is currently at 6.8%. This increase in unemployment was a consequence of the European debt crisis, which had severely decreased demand for exports, causing companies to hold back on investments.  These two factors have therefore decreased both aggregate demand (net exports decrease) and aggregate supply (decrease in investments). Therefore fewer jobs are required as less output is being demanded. This is shown by the numerous job cuts which have occurred throughout Germany. "Siemens AG (SIE) said on Aug. 27 it will cut 500 jobs at its German factories making industrial gear boxes and clutches by 2016, citing slack demand".   However, the article states that the unemployment rate is still the lowest it has been for the past two decades, and meanwhile wages are rising. This increase in wages is boosting consumer spending, therefore causing an increase in aggregate demand, which should eventually allow for aggregate supply to increase, and therefore increasing the need for workers.  Moreover, although unemployment has risen in Germany, it still does not yet compare to the 8.2% unemployment of the US, the 10.8% in Italy, and the euro-area average of 11.2%. 

The article explains how the German retail sales decreased by 0.9 percent in July, as a result of the increasing fuel prices.  The inflated prices of fuel have caused the consumption on other goods and services of households in Germany to decrease. Consumption is one of the four factors that affects the aggregate demand or the total demand for final goods and services in an economy at a given time and price level, in an economy. Therefore, if consumption of households decreases the aggregate demand in an economy also decreases. Hence, the aggregate demand in Germany's economy has decreased significantly and therefore their retail sales have also decreased, by 0.9 percent as the article claims. This is because if consumption is lower than the units of output sold are also lower. 

One of the factors affecting aggregate demand is a country's net exports. Ceteris paribus, as price levels in a country fall, goods and services produced in that country become more attractive to foreign consumers. Some countries have no choice but to import items that they cannot produce. This is another reason for countries to import goods. In this case, the UAE is importing a variety of products from France, ranging from heavy equipment to consumer goods, particularly luxury goods. This article states that France's exports to the UAE are expected to grow 3% this year in comparison with 2011. Therefore, an increase in net exports is anticipated. A result of this could be that the aggregate demand of France will increase. At the same time, the UAE is importing more, so its net exports are decreasing. Hence, its aggregate demand will decrease.

This article discusses the changes which European Union officials are planning for the future in order to ensure economic growth. One of the changes mentioned are the Spanish borrowing costs which will be pushed up to their highest levels for four months. In the short-run this will mean less spending from consumers, but in the long run will ensure a significant decrease in debt. Furthermore, they have called on national governments to "implement a series of job-creating policies". These include cutting labor-related taxes, as well as shifting the burden to property, energy and emission levels. These particular changes will cause a rightward shift in aggregate demand as there is an increase in government spending. Moreover, countries will be forced to lift remaining restrictions on worker movement within the EU, which will allow for more employment. This will also cause a rightward shift in aggregate demand because there will be more employed workers and therefore amount of consumption will increase as more people will be able to spend more money.  Overall, this article shows improvements for the future which will increase aggregate demand of the EU. 

China faces some serious economic problems. One main problem is that China seems to be suffering from excess capacity resulting from an overinvestment in factories, retail stores or infrastructure which leads to an imbalanced supply and aggregate demand relation. Aggregate demand is the total demand for a nation's goods and services from domestic households, firms, the government and foreigners. The article reveals two different approaches to evaluating China's economy: the Keynesian theory and the Austrian school theory. The Keynesians argue that aggregate demand drives stability and that governments can and should help in difficult times. The Chinese government has the tools to increase aggregate demand as it could for example "adjust interest rates and bank reserve requirements, instruct state-owned banks to maintain lending", deploy foreign exchange reserves, or initiate construction and infrastructure projects. On the other hand, the Austrian school of economics believes that it is hard for the government to invest money wisely, particularly in China, where there seems to be an environment of "economic favoritism". The Keynesians may believe that China will be able to manage its overcapacity; however, the Austrian theory argues that the Chinese government will distort resource allocation and further limit aggregate demand. - Julieta Fischer

Indonesia has been experiencing rapid economic growth which has increased the size of the middle class as well as their disposable incomes. The article describes how an increase in required down-payments on cars and houses may decrease the growth in Indonesia's economy. Last year the automotive finance growth of banks was 55%, the highest in the world. They have noticed that this is an unsustainable rate of growth. Due to these fears the Indonesian central bank has placed new regulations which will make buyers pay higher down-payments when making a purchase on credit. These down-payments have been increased from originally 10-20% to 30% and more. With that households see themselves with less money available for consumption. The new regulations may also result in a dip in property sales as aggregate demand decreases. However on the other side it may also only defer sales, since people will safe longer until they buy property. 

Unemployment is Greece has reached its highest point, 23.1% from only 8% before the economic crisis two years ago. 672,000 out of 800,000 registered unemployed people are not receiving any unemployment benefits and therefore have no income at all. This means there is a huge number of people who are not able purchase goods and services so the overall consumption is decreasing. Unemployment is costing Greece about five billion per year. Minimum wages have also been cut by 23% which are increasing the costs for the government.  This had led to an $81 billion decrease in consumption and the shutting down of thousands of businesses which means the aggregate demand curve has shifted to the left, decreasing consumption in the country. The economy in Greece has shrunk by 7%, meaning it is in recession. 

The article discusses that the US may face a fiscal cliff in order to reduce the large deficit that has accumulated in the past. A fiscal policy stands for a series of major tax increases and government spending cuts if Congress does not act. The article discusses that through lower government spending and higher taxes it is expected that $600 billion can be extracted from the economy to decrease the debt. However economists think that every dollar of deficit reduction will subtract the same or a greater amount from economic growth. In theoretical terms this would make sense. If government spending decrease this reduces aggregate demand in the economy and by that will cause a decrease in real GDP. Households will cut back on purchases and especially households that are dependent on government support through unemployment benefits will suffer from the policy. Although this will decrease the deficit of the US it may be that it distracts the fragile recovering economy. 

coming soon. 

India's investors and some politicians want the Reserve Bank of India (RBI) to lower its interest rates so that more firms could invest in capital goods in the country. This would increase investment, which in turn would shift aggregate demand to the right and lead to GDP growth. RBI however argues that lowering the interest rates could cause inflation to go up, which in turn would have a great effect on India's lower class citizens. The RBI also argues that interest rates are not very high at the moment, and blame the lack of investment in 'bad governance and lack of reforms'. If the RBI lowered the interest rates and investment did not increase much as they argue, while inflation goes up, many poor people would suffer in the process as they wouldn't be able to buy as many essential goods such as food. This would cause a movement along the aggregate demand curve as price level goes up. On the other hand, from an investor's perspective this would be the best way to generate economic growth, which would benefit the country as a whole if it led to more investment on capital goods.

Investors in India are asking the Reserve Bank of India (RBI) for lower interest rates, so that more can be invested in order to accelerate the country's growth rate (which has been decelerating). However, the RBI is concerned that this could lead to an increase in inflation (which is already high) as AD would increase, causing the country to produce beyond its full level of employment, meaning that price levels would raise more than RGDP proportionally (demand pull inflation). The RBI believes that people are more concerned with inflation as it causes the price of food to go up, affecting poor families. However, there is a possibility that growth is of more importance to Indians when looking at the country's economic performance. Other factors such as an increase in oil prices and a poor-monsoon could drive food prices even higher. As result the Indian RBI must be very cautious whether it will be worth lowering interest rates.

The article is concerned with the current economic situation in Ireland, namely a recession. This is a period of decline in an economy, where in the business cycle it is known as a 'trough'. This is illustrated well in the article through the decline of demand in the housing market, as a decrease demand is a typical characteristic of a recession. The overall demand or aggregate demand of a country decreases during a recession, as seen in the Irish housing market, as people have lost confidence in the economy, uncertainty has gone up and unemployment has increased. Consequently people save their money as the situation is unstable and they are unsure of their furture imployment and income. Saving is a leakage in the cycle and therefore corresponds to the decrease in aggreagate demand. In the article's context, The Irish are untrusting and therefore unwilling to invest in new housing. This is all a result of bad planning. In the 1990s, Ireland's economy was booming: banks were doing well, the housing market rising significantly and in large demand. Therefore the government decided to build Adamstown. Yet as the housing bubble broke and with it the faith and confidencein the Irish economy, people put their spendings " on hold" as the article illustrates, and areas of modern infra structure such as Adamsville became Ghosttowns.

Iceland has been in a serious recession with great inflation rates for several years. To control the situation, the Central bank has started to raise interest rates with the hope to decrease inflation and bring prices back to normal levels. By increasing interest rates consumers will stop borrowing as much money which will cause a decrease in consumption. In addition it will become more expensive for firms to borrow money for their investments and they will decrease investments well. Overall these two factors will cause a decrease in aggregate demand in Iceland. This will push down prices and cause disinflation in the long run. Due to these decreasing prices goods and services from Iceland become more attractive to foreign consumers causing an increase in exports which may strengthen the currency. The article states that due to the increased interest rates inflation remained stable for the past months. This shows that households and firms are consuming/investing less which stops further inflation.

The unemployment rate in Scotland has increased to 8.2 percent within the last three months. It is now worse than the UK unemployment rate, which is at about 8.1 percent.In order to fix the problem, the government has now decided to step in, in order to achieve economic growth and get people back into work. The government wants to do this by simplifying the business environment and reform the tax system for companies in order to help them create more jobs. By decreasing the costs of production, the government wants the SRAS curve to shift to the right and therefor increase aggregate supply. If costs of producing are lower, firms will higher more workers, which will result in less unemployment according to theory. 

Ireland's high current unemployment rate of 14.9 percent is a result from its economic situation : Ireland is in a recession. The article clearly stipulates this, there is a 'recession in the real domestic economy'. The recession arose from the housing bubble : mortgages were cheap, people overborrowed and then the high housing prices fell so that people were less wealthy and no longer able to pay their mortgages. Wealth is a determinant of AD. It is the added value of all assets or stocks. If wealth or perceived wealth increases, then so will a household's consumption of goods, thereby shifting demand, as the household feels 'wealthier' or able to purchase more. The reverse is also the case, when wealth declines, demand declines, such as in Ireland. The Irish were much less willing to consume goods, as they believed they were less wealthy or had less money( which they eventually did , upon having to pay mortgages; debt), and so consumption decreased, which thus shifted aggregate demand into a demand slide recession. This is a situation where prices in a nation inflate and output decreases, due to the lesser demand. If less is being produced, less factors of production are required. Thus labor, a major factor of production is no longer required in the economy, which gives firms the incentive to lay off many of their workers. This is the unemployment Ireland is experiencing. It is interesting that the article also depicts the  'austerity drive'  that the Irish government resulted to in the recession.  As it correctly suggests, this is 'self defeating', as during a demand slide recession the Keynesian policy follows that the government should not save its funding, but rather spend. In a time of recession, the government should spend,  so as to decrease unemployment stimulate the economy. If the government spends, this will have a multiplier effect through the economy, as it provides income to households ( by spending, the government employs labor), where househo

This article explains how the Swiss economy continued to grow despite the predictions that it would shrink or go into a recession. Economists thought this, because the franc became a strong currency, making Switzerland's imports cheaper but making it very expensive for other countries to buy goods from Switzerland, meaning fewer exports for Switzerland. Since we know that GDP can be calculated by adding the incomes produced by C (Consumers) + I (Investments) + G (Government) + X (Exports - Imports), we will see that Switzerland's GDP would decrease because less exports or more exports would make 'X' a negative value lowering the nations GDP. However, Switzerland's GDP went different as expected. Even though exports were now more costly for other countries, Switzerland exports grew by 2.8 % in the last quarter of the year, in precious metals, jewels or arts. Adding on to that, the gross fixed investments also grew by 2.5 % in investments in construction and equipment as the strong currency proved a "safe-haven" for investor. The rise in exports and investments lead to an unexpected and unpredicted expansion of the Swiss economy instead of a recession.