Macroeconomic equilibrium occurs where the aggregate demand is equal to long-run aggregate supply.

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Macroeconomic equilibrium occurs where the aggregate demand is equal to aggregate supply, which can be in the short run or long run. The distinction is important because the long-run aggregate supply is not always the point of equilibrium, especially in the presence of short-term economic fluctuations.

Macroeconomic Equilibrium Occurs Where the Aggregate Demand Is Equal to Long-Run