183k views
5 votes
What are the reason why there is government revenue surplus?​

User Reachgoals
by
5.7k points

1 Answer

6 votes

Answer:

Impact on growth.

Step-by-step explanation:

If the government is forced to increase taxes / cut spending to meet a budget surplus, it could have an adverse effect on the rate of economic growth. If government spending is cut, then it will negatively affect AD and could lead to lower growth. A budget surplus doesn't have to cause lower growth.

User Krzysztof Branicki
by
6.2k points