When a government's budget is in _____,it is required to issue new government securities,and when the budget is in _______,it may retire maturing debt and redeem some debt prior to maturity.

Question

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When a government's budget is in deficit, it means the government is spending more than it is earning, thus it needs to borrow money, often by issuing new government securities. Conversely, when the budget is in surplus, the government has extra funds, which it may use to pay off existing debt, either by retiring maturing debt or redeeming some debt prior to maturity.

When a Government's Budget Is in _____,It Is Required to Issue