The budget of an economy is said to be in deficit when _____
A) federal outlays exceed revenues.
B) federal revenues exceed outlays.
C) the anticipated inflation rate exceeds the actual rate.
D) there is a loss of value in the domestic currency with respect to one or more foreign currencies.
E) the anticipated interest rate exceeds the actual rate.

Question

Quizplus · Accepted Answer

A budget deficit occurs when a government's spending exceeds its revenue or income. In other words, when federal outlays (spending) exceed federal revenues (income), a budget deficit is created.

The Budget of an Economy Is Said to Be in Deficit