Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
When a government spends more money than it receives in revenue
B
When a government receives more money than it spends
C
When a government has a balanced budget
D
When a government borrows money from the public
Understanding the Answer
Let's break down why this is correct
Answer
A government budget deficit happens when a government spends more money than it earns in a certain period, usually a year. This means that if a government collects $1 million in taxes but spends $1. 2 million on things like schools, roads, and healthcare, it has a deficit of $200,000. To cover this shortfall, the government may borrow money or use savings. While running a deficit can help fund important projects, it can also lead to debt that the government must pay back later.
Detailed Explanation
A budget deficit happens when a government spends more money than it gets from taxes and other income. Other options are incorrect because This option suggests that the government has extra money; A balanced budget means spending equals income.
Key Concepts
government budget deficit
Topic
Government Budget Deficits
Difficulty
easy level question
Cognitive Level
understand
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