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What is deflationary gap

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What is deflationary gap

Posted by Sakshi Hela 5 months, 4 weeks ago

CBSE > Class 12 > Economics

1 answers

Preeti Dabral 5 months, 4 weeks ago

Deflationary gap is the shortfall in AD from the level required to maintain full employment equilibrium in the economy. In other words, it is equal to the difference between AD at full employment and AD at underemployment. In such a situation, there is involuntary unemployment in the economy.

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