Place the following items in order of the magnitude of the effect on the aggregate demand curve, starting with the greatest effect and descending to the least. Keep in mind that there will be an item which has zero effect on the AD curve (because it causes movement along the curve). Start by clicking the first item in the sequence or dragging it here Drag the items below into the box above in the correct order, starting with the first item in the sequence. Development of computer-based technologies from the 1940s to now. People notice prices rising and an associated decrease in purchasing power. State governments in the 2010s cut their budgets for teachers, infrastructure, police, and other government expenditures. Prices of tech stocks increase in the late 1990s as a result of a speculative bubble, A trade war with China in the late 2010s leads to a decrease in trade.

Development of computer-based technologies from the 1940s to now.
State governments in the 2010s cut their budgets for teachers, infrastructure, police, and other government expenditures.
Prices of tech stocks increase in the late 1990s as a result of a speculative bubble.
People notice prices rising and an associated decrease in purchasing power.
A trade war with China in the late 2010s leads to a decrease in trade.

What were the effects of these items on aggregate demand?

Development of computer technologies had the highest effect on aggregate demand because they increased production on an unprecedented scale which allowed for more people to earn incomes.

State governments cutting their budget in the 2010s reduced aggregate demand because government spending is important to aggregate demand.

Prices then rose which led to less people demanding goods and services and the trade war with China led to a decrease in trade and in aggregate demand.

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