--%>

Concept of deflationary gap

Elucidate the concept of deflationary gap.

Answer: Deflationary gap is the deficit in aggregate demand from the level needed to maintain full employment equilibrium.

   Related Questions in Macroeconomics

  • Q : Expenditure of money on party effects

    When you pay a straight A student in advance to write up your term paper and that person expends the money on a party and then, hung-over, can’t do a good job and hence you wind up with an F for submitting sloppily written gibberish, you encompass just suffered

  • Q : Value of total receipts of government

    Determine the value of total receipts of government budget when budget deficit is Rs 2,000 crores and the net expenses is Rs 3,000 crores.

  • Q : Determining bank problem Which of the

    Which of the given is a bank? a) Post office saving banks (b) LIC (c) UTI (d) IDBI.

  • Q : Physical quality of life index DISCUSS

    DISCUSS the experience of high GNP countries and low GNP with regard to PQLI.

  • Q : International trade the most frequently

    the most frequently asked question on foreign direct invetment

  • Q : Value added technique for national

    What is the alternative name of value added technique of estimating national income? The alternative name of value added technique of estimating national income is production method.

  • Q : GDP gap "The economic cost of

    "The economic cost of unemployment is measured by the GDP gap." Explain this statement. ?

  • Q : Would inflation targeting be a good

    Question: Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment?

    Q : How commercial bank make money How does

    How does a commercial bank make money? Answer: Commercial banks are capable to make credit that is many times greater than deposits received by banks. Money creatio

  • Q : Open-Economy Macroeconomics

    Open-Economy Macroeconomics   Suppose the structure of an economy with a flexible exchange rates is represented by:   C = 200 + 0.85*(Y - T)             &n