• Actual Deficit
  • Actual Deficit

    DEFINITION OF 'Actual Deficit'

    Actual Deficit = Structural Deficit + Cyclical Deficit

    Deficit implies  shortage of revenue when it is compared to the expenditure of govt. Deficit may be witnessed when economy operates at its full capacity or less than full capacity.

    Structural deficit exists when economy operates at full capacity or economy operates at full potential level

    While cyclical deficit occurs when economy does not operates at full potential level or there is considerate capacity to increase the output. 

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