Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Determination of Income and Employment

Question:

Over full employment equilibrium is a situation in which AD = AS _______ the full employment level.

Which of the following options suits best in the above blank?

Options:

At

Beyond

Under

None

Correct Answer:

Beyond

Explanation:

The correct answer is Option 2: Over full employment equilibrium 

Over full employment equilibrium is a situation where aggregate demand (AD) equals aggregate supply (AS) beyond the full employment level. This means that the economy is producing beyond its full capacity, often leading to inflationary pressures.