(Answered) the relation between government deficit and government debtthe relation between government deficit…

➤ When is running a government deficit appropriate?
Running a deficit makes sense during recessions, emergencies, or when public investment yields long-term returns. Countercyclical fiscal policy supports demand and stabilizes output. However, deficits should narrow during expansions. Distinguish cyclical deficits from structural shortfalls that need lasting policy changes to restore balance.