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

Here we are looking at macroeconomics.

A budget deficit means that Government spending (G) is greater than Tax revenue the government receives (T). This means there are more injections into the economy than withdrawals out of the economy. A budget deficit is likely to boost AD as AD=C+I+G+(X-M)

JB
Answered by James B. Economics tutor

2912 Views

See similar Economics GCSE tutors

Related Economics GCSE answers

All answers ▸

How can you calculate the Price and Quantity at a market equilibrium given the Demand curve P = 20 - Q and the Supply curve P = 3Q


Explain why the demand for food is relatively price inelastic.


Analyse 2 causes of shifts in the demand curve and the consequence for the consumer.


explain the function of fiscal policy


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2026 by IXL Learning