Deflationary gap

Deflationary Gap
Definition Deflationary Gap
The difference between full employment level of output and actual output.

Deflationary gap
Definition: A deflationary gap exists when there is insufficient demand available in the economy to generate a full-employment equilibrium.

Deflationary gap -The shortfall of national expenditure below national income (and injections below withdrawals) at the full-employment level of national income.

See also: Deflation, Equilibrium, Expense, Target market, Contra account