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EQUILIBRIUM, SHORT-RUN AGGREGATE MARKET: The state of equilibrium that exists in the short-run aggregate market when real aggregate expenditures are equal to full employment real production with no imbalances to induce changes in the price level or real production. In other words, the opposing forces of aggregate demand (the buyers) and short-run aggregate supply (the sellers) exactly offset each other. Equilibrium in the short-run aggregate market achieves balance in the product markets and financial markets, but not in the resource markets. It also involves simultaneous equilibrium in the aggregated financial and resource markets.
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DEMAND SHOCK A disruption of market equilibrium caused by a change in a demand determinant and a shift of the demand curve. A demand shock can take one of two forms--a demand increase or a demand decrease. This is one of two disruptions of the market. The other is a supply shock.
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The first U.S. fire insurance company was established by Benjamin Franklin in 1752 in Philadelphia.
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"I learned about the strength you can get from a close family life. I learned to keep going, even in bad times. I learned not to despair, even when my world was falling apart. I learned that there are no free lunches. And I learned the value of hard work. " -- Lee Iacocca
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JPE
Journal of Political Economy
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