When injections equal leakages, what term is used to describe this stable economic condition?

When injections equal leakages in an economy, the term used to describe this stable economic condition is equilibrium. In this context, injections refer to the additions to the circular flow of income that stem from investments, government spending, and exports. Leakages, on the other hand, represent the outgoing flows from the economic system through savings, taxes, and imports.

Equilibrium occurs when these two forces balance each other, meaning that the total amount of money entering the economy through injections is equal to the total amount leaving through leakages. This balance is crucial because it indicates that the economy is stable and operating effectively, without significant inflation or recessionary pressures.

Other terms like disequilibrium describe a state in which this balance does not exist, leading to economic fluctuations. A recession signifies a period of economic decline, while a trough marks the lowest point of a business cycle following a recession. Neither of these terms represents the stable condition that equilibrium does when injections and leakages are equal.