BALANCED-BUDGET AMENDMENT: A proposed amendment to the U.S. Constitution that would constrain total government spending to be less than or equal to total tax collections. Such an amendment would effectively eliminate the federal deficit, which results when the spending exceeds taxes. The logic behind such an amendment is to prevent discretionary use of fiscal policy, which is often blamed for political business cycles and the resulting problems of inflation and unemployment. It is also touted as a way to limit the size of the Federal government.

     See also | government | budget deficit | budget surplus | government purchases | taxes | transfer payments | fiscal policy | political business cycle | conservative | money supply rule | automatic stabilizers | inflation | unemployment |

BALANCED-BUDGET AMENDMENT, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2023. [Accessed: June 10, 2023].

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The total (or aggregate) real production of final goods and services available in the domestic economy at a range of price levels, during a period of time in which some prices, especially wages, are rigid, inflexible, or otherwise in the process of adjusting. Short-run aggregate supply, commonly abbreviated SRAS, is one of two aggregate supply alternatives, distinguished by the degree of price flexibility. The other is long-run aggregate supply. Short-run aggregate supply is combined with aggregate demand in the short-run aggregate market analysis used to analyze business-cycle instability, unemployment, inflation, government stabilization policies, and related macroeconomic topics.

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