How do investors benefit from a deficit budget?

Question

Social Studies

Koen Mahoney

24 July, 11:29

How do investors benefit from a deficit budget?

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Cynthia Hoffman · Answer 1

A deficit budget is present when the government borrows to the private sector. This money out of the central bank of the government gives the investors an opportunity to invest, buy properties, get into businesses, etc. A deficit budget may be beneficial depending on the exchange rate system, the motives for the borrowing and the interest rates.