Please Explain meaning of Structural Deficit and difference between deficit below full employment and structural deficit ? With the help of ”Audio Clip”
Share
Please briefly explain why you feel this question should be reported.
Please briefly explain why you feel this answer should be reported.
Please briefly explain why you feel this user should be reported.
So if there is recession in the country so automatically the revenue for the government that is Taxes will automatically be less because of consumption.
So as revenue of the government has decreased so in order to increase the consumption that is to increase the aggregate demand the government has to cut the taxes below the automatic generated tax that they have received that is they have to lower their revenue more so as you can see government has decrease the taxes below the automatic generated tax this process is called structural deficit as this will cause an increase in aggregate demand as they are lower taxes people will consume more and government will increases the spending.