If government expenditure exceeds revenue, this result in
Answer Details
When the government's spending exceeds its revenue, it leads to a budget deficit. This means that the government has to borrow money to cover the shortfall in its expenditures. A budget deficit can have various effects on an economy, such as increasing the national debt, reducing the value of the country's currency, and leading to higher inflation. Governments may choose to run a deficit to finance public projects, stimulate economic growth, or deal with emergencies. However, it is generally viewed as unsustainable in the long run, as it can lead to a vicious cycle of debt and interest payments, ultimately harming the economy.