Which of the following statements regarding the U.S government's budget surpluses and deficits is correct?
A) If tax revenues exceed outlays, the government has a budget deficit.
B) During the 1980s large deficits arose from a combination of tax cuts and expenditure increases.
C) Budget deficits tend to shrink during periods of recession.
D) Since 1980, federal tax revenues have generally exceeded outlays.

Question

Quizplus · Accepted Answer

During the 1980s, large deficits did arise from a combination of tax cuts and expenditure increases. Option A is incorrect as it states the opposite of the correct statement. Option C is also incorrect as budget deficits tend to increase during periods of recession. Option D is also incorrect as there have been periods where federal outlays have exceeded tax revenues.

Which of the Following Statements Regarding the U