Which of the following statements about the budget deficit is TRUE?
A) It is a stock variable.
B) It is a flow variable.
C) It is equal to the public debt.
D) none of the above

Question

Quizplus · Accepted Answer

A budget deficit is a flow variable as it measures the annual amount by which government spending exceeds revenue. A stock variable, on the other hand, measures the amount of a variable at a specific point in time. The budget deficit is not equal to the public debt, as the public debt is the total amount of money owed by the government at a specific point in time, while the deficit is the annual shortfall between spending and revenue.

Which of the Following Statements About the Budget Deficit Is