Under what circumstances does a federal budget deficit occur?

Question

Quizplus · Accepted Answer

A federal budget deficit occurs when government purchases exceed net taxes. This means that the government is spending more money than it is collecting in taxes, leading to a shortfall that must be made up through borrowing. Deficits can occur regardless of whether the economy is experiencing inflation, deflation, or balanced growth, as they reflect the government's budgetary choices rather than broader economic conditions.

Under What Circumstances Does a Federal Budget Deficit Occur