We have been learning about these concepts and J had that question. In my book, the Keynesian cross actual expenditure is labeled as AD. But isn't AD downward slopping with price and in Keynesian cross, the assumption is that prices are fixed in the short run? So why is that difference happening?
In addition to that, why is planned expenditure assuming 0 savings?
What is the Aggregate Demand in Keynesian Cross and how is it different from both actual expenditure and the AD in AD-AS models?
byu/ActMysterious2294 inAskEconomics
Posted by ActMysterious2294