In 2007, Denmarkʹs government had expenditures of $157 billion and spending of $171 billion. GDP in 2007 was $312 billion. The government ran a budget and government debt____________
A) surplus; increased
B) surplus decreased
C) deficit; increased
D) deficit; decreased

Question

Quizplus · Accepted Answer

The government expenditures exceeded the spending, indicating a deficit. Since there is no information about whether the deficit increased or decreased, we cannot determine the second part of the answer. However, we can conclude that the government debt increased because the deficit means the government had to borrow money to cover its expenses.

In 2007, Denmarkʹs Government Had Expenditures of $157 Billion and Spending