What would a hung parliament mean for the UK?

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Fears of a hung parliament have recently hit sterling hard, but what exactly would a hung parliament entail and why the panic?

Since World War II, the UK has only experienced one hung parliament. The reason for this is the electoral system - a party will only win a seat if it gets the largest number of votes in a single constituency, so political parties try to appeal to as wide a swathe of the population as possible. Smaller parties can win thousands of votes but still not win a seat, rendering it much more likely that a single party gains a majority. As a result there have only been two real hung parliaments in British parliamentary history; in 1924 and most recently, 1974. Occasionally though parliaments h...

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