Step 1: Clarify what full employment does NOT mean:
It does not mean literally zero unemployment of any kind — someone briefly between jobs (frictional) or voluntarily not working at the going wage is not counted against full employment; it specifically rules out involuntary, demand-deficient (cyclical) unemployment.
Step 2: Connect the definition to the AD-AS framework:
Full employment output is the level AS can produce when all willing workers are engaged; the economy is "at" full employment when AD is exactly enough to buy that output — too little AD causes deficient demand (job losses), too much causes an inflationary gap (rising prices without more real jobs).
Step 3: Group the responsible factors into demand-side and supply-side:
Demand-side: adequate AD sustained through sound monetary policy (interest rates/credit) and fiscal policy (spending/taxation), plus general price stability and investor confidence. Supply-side: a workforce with the right skills, and infrastructure that keeps businesses able to operate and expand without bottlenecks.
Final Answer:
Full employment = no involuntary unemployment; it is sustained by balanced aggregate demand (via monetary/fiscal policy), price stability, business confidence, a skill-matched workforce, and adequate infrastructure.