CBSE
Class 10
Class 12
Inflationary Gap: Inflationary gap is the gap by which actual aggregate demand exceeds the level of aggregate demand required to establish full employment. It measures the amount of excess of aggregate demand.
Deflationary Gap: Deflationary gap is the gap by which actual aggregate demand is less than the level of aggregate demand required to establish full employment. It measures the amount of deficiency of aggregate demand.