Surplus Spending Unit
Definition of 'Surplus Spending Unit'An economic unit with income that is greater than or equal to expenditures on consumption or real investment over the course of a period. A surplus spending unit will use its additional income to buy goods, invest, lend money to deficit spending units or pay off its own deficit from an earlier period. |
|
Investopedia explains 'Surplus Spending Unit'Basically, a surplus spending unit earns more than it spends. Surplus spenders can be individuals, sectors, countries or even the whole economy.The household sector usually represents a surplus spending unit, as this sector earns large portions of disposable income. Most households earn more income than necessary to purchase food, shelter and other basic necessities. As a result, they are able to purchase additional consumer products, hold money in banks, or invest in the stock market. |
Related Definitions
Articles Of Interest
-
Understanding Capital And Financial Accounts In The Balance Of Payments
The current, capital and financial accounts compose a nation's balance of payments. -
Explaining The World Through Macroeconomic Analysis
From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone. -
What Is The Balance Of Payments?
Countries track money coming in and going out through something called the balance of payments. Learn more here. -
Understanding The Current Account In The Balance Of Payments
Learn how a country's current account balance reflects the country's economic health. -
12 Ways To Shop Smarter
The early bird may catch the worm, but in shopping, the worm will come to those who wait. -
Depreciation: Straight-Line Vs. Double-Declining Methods
Appreciate the different methods used to describe how book value is "used up". -
Financial Statement: Extraordinary Vs. Nonrecurring Items
When it comes to analyzing a company, successful analysts spend considerable time differentiating between accounting items that are likely to recur going forward from those that most likely will ... -
Get A Career In Showbiz Accounting
An accounting career doesn't have to be boring. If you love numbers, but want excitement as well, consider the field of showbiz accounting. -
What Management Accountants Do
If you like keeping track of a company's income and expenses but also want to hold a position with significant responsibility and authority, management accounting could be the job for you. -
GAAP And The IFRS Standards Convergence Efforts In 3 Substantial Areas
Understand the specific steps that have been taken in hopes of converging the GAAP and the IFRS accounting standards, despite the philosophically and culturally based methodological differences ...