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What does the government do when it spends more than it collects in taxes?
Wiki User
∙ 12y ago
It must either "borrow" it from somewhere, creating a budget deficit - or - they must print more money, devaluing the nation's currency and causing inflation.
Wiki User
∙ 12y ago
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If unemployment is high and the federal government spends more and lowers taxes the government is utilizing what policy?
fisical policy
What happens when a government runs a budget deficit?
The government prominently collects money in form of taxes and it spends money in many ways such as defense, government jobs, aid programs such as EBT, and etc. Therefore when the government runs a budget deficit they are spending more than they collect, more than likely effecting the national savings.
The public debt increases when?
The Government spends more money than it collects.
When does a budget surplus result?
A budget surplus results when the goverment collects more money than it spends.
Why would a government choose to spend more money than it collects in taxes during a recession or a depression?
Spending increases demand and can encourage economic growth.
When the government collects more revenue than it spends what will be the result?
A Surplus
What occurs when the government collects more revenue than it spends?
Deficit A+ the government will have a surplus
What occurs when the government spends more than he collects in revenue?
That's called a deficit.
Strategies adopted by the government to mitigate the effects on demand in the case of unemployment?
The stimlus package passed by congress early this year attemted to acheive this goal. Whenever the government spends more that it collects through taxes, artificial demand in the economy is stimulated
If unemployment is high and the federal government spends more and lowers taxes the government is utilizing what policy?
fisical policy
What happens when a government runs a budget deficit?
The government prominently collects money in form of taxes and it spends money in many ways such as defense, government jobs, aid programs such as EBT, and etc. Therefore when the government runs a budget deficit they are spending more than they collect, more than likely effecting the national savings.
The public debt increases when?
The Government spends more money than it collects.
Why are taxes raised?
No, we already don't have enough money, taxing us more will further weaken the economy. We should cut government spending.
When does a budget surplus result?
A budget surplus results when the goverment collects more money than it spends.
Why would a government choose to spend more money than it collects in taxes during a recession or a depression?
Spending increases demand and can encourage economic growth.
What is it called when the government spends more than it take in?
When a government spends more money in a year than it takes it, it is called a deficit. When it spends less than it takes in, it is called a surplus.
Do taxes pay off the national debt?
The national debt can be repaid by taxes, but only if the amount of other spending is less than the amount of taxes that are collected. If the government continues to spend more money every year than it collects in taxes, then the debt will necessarily increase.
