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  • 01-03-2017
  • Business
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What is the difference between the nominal and real budget deficit?

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aalexander2018
aalexander2018 aalexander2018
  • 01-03-2017
A nominal deficit is the deficit determined by the difference between actual expenditures and actual receipts. The real deficit is the nominal deficit adjusted for inflation. The two deficit concepts can be related using the following formula: real deficit = nominal deficit - (inflation × total debt).
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