When Congress and the president agree on federal budgets that run significant deficits over many years, what are the likely economic consequences?

Question

Quizplus · Accepted Answer

When the government runs significant deficits, it will have to borrow money to finance its spending. To attract investors to buy government bonds and securities, the government will likely have to increase interest rates, which can have various economic consequences, such as reducing consumer and business spending, slowing economic growth, and increasing the cost of borrowing for households and businesses.

When Congress and the President Agree on Federal Budgets That