In which of the following situations, Aggregate Demand will not fall?

Fall in import

The correct answer is option 3: Fall in import

Aggregate Demand (AD) is composed of several components: consumption expenditure, investment expenditure, government expenditure, and net exports (exports minus imports). Changes in these components can affect AD in different ways.

Let's analyze each situation:

1. Fall in export: A fall in exports reduces net exports, which is a component of AD. Thus, AD will fall.

2. Fall in government expenditure: A fall in government expenditure directly reduces one of the components of AD. Therefore, AD will fall.

3. Fall in import: A fall in imports actually increases net exports (exports minus imports), which means that net exports and hence AD will increase.

4. Fall in private consumption expenditure: A fall in private consumption expenditure reduces one of the main components of AD. Thus, AD will fall.