The budget of an economy is said to be in surplus 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 surplus occurs when government revenues from taxes and other sources exceeds government spending. This means that the government is collecting more money than it is spending, which can be seen as a positive sign for the economy as it can be used to pay off debt, invest in infrastructure or services, or save for future expenses. Therefore, option B is the correct answer as it describes a situation of budget surplus.

The Budget of an Economy Is Said to Be in Surplus