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Economics

Deficient demand

This Class 12 Economics topic from “Determination of Income and Employment” explains deficient demand, a situation in which aggregate demand is lower than the level needed to purchase the economy’s full-employment output. Students learn how insufficient consumption, investment, government spending, or net exports can create a deflationary gap, reduce income and production, and cause involuntary unemployment. The topic also introduces the role of fiscal and monetary measures in restoring aggregate demand and employment.

Medium · Level 1 · 1 questions

Practice questions

01What does income determination mean in macroeconomics?

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