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

Question

Quizplus · Accepted Answer

A budget deficit occurs when the government's expenditures (outlays) exceed its revenues. In other words, the government is spending more money than it is collecting through taxes and other sources of revenue. This results in the government having to borrow money to make up the shortfall, which can lead to increased debt and interest payments in the future.

The Budget of an Economy Is Said to Be in Deficit