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Surplus Spending Unit

Surplus Spending Unit Definition

Surplus Spending Unit refers to an individual or group the income of which is greater than its expenses and uses its surplus to buy goods or services, or lend money to economic units that have deficit. Usually individuals have a surplus when they earn more than needed to cover basic necessities. The surplus can be used to buy consumer products or invest in financial markets. Before the debt crisis many individuals spent more than they earned due to loans with low interest rates, thus they became deficit spending units.

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