Many cheap and shared hosting have limits on resources and number of databases allowed.
If you have hit the maximum number of database allowed by your web hosting provider, you can still install multiple WordPress sites. Of course, this is subject to other limits that many be imposed by your hosting service provider.
When you are installing WordPress using the wizard, the screen has an option to choose the database prefix. In general, the database prefix is set by default as “wp_”. Simply change this prefix to a unique prefix, say “wp101_”, for your new site, and you will be able to install multiple WP sites on the same database.
An alternative is to install a multi-site WordPress instead of using the standard WP installation. However, using multi-site WordPress is slightly tricky and requires more configuration. You will also have to add all the domains to your hosting as an alias domain (not add-on domain).