Which of the following is NOT a component of aggregate demand?

Aggregate demand is composed of several components that capture all the expenditures made in an economy. The primary components of aggregate demand include consumption, investment, government spending, and net exports.

Consumption refers to the total spending by households on goods and services. Governments contribute to aggregate demand through their spending on public services, infrastructure, and other expenditures. Net exports represent the value of a country's exports minus its imports, illustrating how trade balances affect overall demand.

Monetary policy, however, is not a direct component of aggregate demand. Instead, it refers to the actions taken by a country's central bank to control the money supply and interest rates to influence economic activity. While monetary policy can indirectly affect aggregate demand by influencing consumption and investment decisions, it does not itself represent a component of aggregate demand like the others listed do.

Identifying monetary policy as the option that is not a component of aggregate demand highlights the distinction between the tools of economic management and the actual demand within the economy.