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Equilibrium GDP
The level of real GDP at which the total quantity of goods and services produced equals the total quantity of goods and services purchased.
Full Employment GDP
The output level of goods and services in the economy when all available labor resources are being used in the most efficient way possible.
Multiplier
A factor that quantifies how an initial change in economic activity (e.g., spending or investment) leads to a more than proportional change in the national income.
Deflationary Gap
A situation where aggregate demand in an economy is lower than the aggregate supply, leading to falling prices, reduced production, and unemployment.
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