Expansionary gap

Expansionary gap,

Definition of Expansionary gap:

  1. A part of a business cycle expansion, particularly in the latter stages where there is a difference between the equilibrium real production achieved in the short-run aggregate market and the full-employment real production which occurs when short run equilibrium real production is more than full-employment real production. Also called inflationary gap.

Meaning of Expansionary gap & Expansionary gap Definition