ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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the Government spent more money than it collected in taxes
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the Government collected more in taxes than it spent.
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the Government spent more money than the Federal Reserve
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the Federal Reserve spent more money than the government
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Detailed explanation-1: -What is the Difference Between the Federal Budget Deficit and the Federal Government Debt? A federal budget deficit occurs when government spending outpaces revenue or the income drawn from taxes, fees, and investments. Deficits add to the national debt or federal government debt.
Detailed explanation-2: -Understanding the National Deficit A budget deficit occurs when money going out (spending) exceeds money coming in (revenue) during a defined period. In FY 2022, the federal government spent $6.27 trillion and collected $4.90 trillion in revenue, resulting in a deficit.
Detailed explanation-3: -Definition: The difference between total revenue and total expenditure of the government is termed as fiscal deficit.
Detailed explanation-4: -When a government spends more than it collects in taxes, it is said to have a budget deficit. When a government collects more in taxes than it spends, it is said to have a budget surplus. If government spending and taxes are equal, it is said to have a balanced budget.
Detailed explanation-5: -A budget surplus is when income or revenue exceeds expenditures. Governments and companies with surpluses have additional money that can be reinvested or used to pay off debts. The opposite of a surplus is a deficit, which occurs when spending exceeds revenues.