Overview
A budget deficit occurs when a government's expenditures surpass its revenues, necessitating borrowing to cover the shortfall. This situation can arise from various factors, including increased spending on public services or a decline in tax revenues. Understanding budget deficits is crucial for ana...
Key Terms
Example: The government proposed a budget for the next fiscal year.
Example: The state's revenue increased due to higher sales tax.
Example: Healthcare is a major expenditure in the national budget.
Example: The government adjusted fiscal policy to stimulate growth.
Example: The national debt has increased due to ongoing deficits.
Example: Inflation can erode purchasing power.
Related Topics
Fiscal Policy
The use of government spending and taxation to influence the economy.
intermediateNational Debt
The total amount of money that a country's government has borrowed.
intermediateEconomic Growth
The increase in the production of goods and services in an economy.
intermediateInflation
The rate at which the general level of prices for goods and services rises.
beginnerKey Concepts
government spendingrevenuedebteconomic impact