• Ratio Analysis
  • Ratio analysis - Types
  • Real Deficit
  • Real Deficit

    DEFINITION OF 'Real Deficit'

    Deficit is shortfall in the revenue of government over the its expenditure. when Deficit is adjusted for inflation, it is called Real deficit.

    Real Deficit = Actual Deficit - Rate of inflation×Debt

    when inflation rises, the value of money goes down and automatically debt liability of debtor falls as well. 

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  • Reflation