A ________ occurs when government spending exceeds tax revenue.

Question

Quizplus · Accepted Answer

A budget deficit occurs when a government spends more money than it collects in tax revenue. This can lead to increased national debt and interest payments, as well as potential inflationary pressures on the economy. Negative externalities and positive externalities are not directly related to government spending and tax revenues. Consumer surplus refers to the difference between the maximum amount that a consumer would be willing to pay for a good and the actual price they pay, and is not directly related to government finances.

A ________ Occurs When Government Spending Exceeds Tax Revenue