A budget surplus occurs when a government takes in more tax revenue than it spends, a budget deficit is when it spends more than it takes in and a balanced budget is when the two amounts are equal.
A budget refers to an estimate of income and expenditure that is set for a period of time.
Budget surplus is when the income set aside exceeds the expenditure for the period. This is prevalent when expenses are less than the incomes and is common in governments.
Budget deficit occurs when spending exceeds the revenue available in a given period of time. Consistent deficits lead to an increase debt.
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