Explain why a government budget deficit is likely to stimulate economic growth.

When there is a government budget deficit it means that the government spending is greater than the government revenue, hence there is more money being channeled into the economy. This money can be used to invest in transport or infrastructure and so stimulating economic growth as increased jobs and opportunities arise.

Answered by Hattie C. Economics tutor

2161 Views

See similar Economics GCSE tutors

Related Economics GCSE answers

All answers ▸

Explain why food is price inelastic.


What are the short term pricing differences in the different market structures?


What are causes of globalisation?


Explain what a supply shock is, using a relevant example.


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo
Cookie Preferences