Question

Describe the possible ways to reduce the government budget deficit.

Short answer

Increasing revenue through raising taxes and/or increasing economic activity, or decreasing costs by reducing government-run programmes.

Step-by-step solution

Deficit.

A deficit develops when expenditures exceed revenue, thus damaging a country's financial health. When discussing total economic spending rather instead of the budgets of enterprises or individuals, the term "budget deficit" is usually used. The debt is created of fiscal shortfalls.

Possible ways to cut back government deficit.

A large deficit value suggests that the Government should reduce its spending. The Government could also be able to raise revenue by raising government revenue. Disinvestment, or the sale of assets, otherwise to deal with the revenue shortfall.