When the U.S.government runs a deficit,it usually does the following:
A) It buys government bonds from the public
B) It asks the Treasury Department to print money to pay for the deficit
C) It sells new government bonds to the public
D) It borrows money directly from the Federal Reserve
E) It asks the Federal Reserve to print money to pay for the deficit.

Question

Quizplus · Accepted Answer

When the U.S. government runs a deficit, it usually sells new government bonds to the public to borrow money to finance the deficit. This increases the national debt but provides a way for the government to finance its operations without directly printing money or borrowing from the Federal Reserve.