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internal balance (EO, F4)<br />The FULL-EMPLOYMENT level of AGGREGATE DEMAND for a country, assuming that there is complete mobility of labour and constant money wage rates. This is contrasted with EXTERNAL BALANCE. It is the task of macroeconomic policy-makers to achieve internal and external balances simultaneously. (See the figure.)
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putty-clay (E2)<br />According to CAPITAL THEORY, a technology that in the short run allows little substitution between capital and labour. The consequence is that changes in capacity and in employment and output are closely linked.
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propensity to consume (E2)<br />Either AVERAGE or MARGINAL PROPENSITY TO CONSUME.
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