What is budget surplus?
Budget surplus is when taxation is greater than government spending
Why might government make a budget surplus?
according to AD=C+I+G+(X-M),
that I think , because the aggregate demand increase , consumption will increase, it may lead to
inflation and in order to deal with inflation, the government need make the aggregate go down,
therefor they increase the tax , the disposable income goes down, aggregate demand goes down,
and inflation decrease
Hello
13 years ago
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