macroeconomic equilibrium

Macroeconomic equilibrium occurs when the overall supply of goods and services (produced by businesses) equals the total demand from consumers, businesses, and the government at a stable price level. In this balance point, there’s no inherent pressure for prices to rise or fall, and the economy operates smoothly without excess inflation or unemployment. Think of it as the economy’s "sweet spot," where everything produced is sold, and resources are used efficiently. External factors or shocks can disrupt this balance, leading to economic growth, recession, or inflation until a new equilibrium is reached.