ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -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-2: -To pay for government programs while operating under a deficit, the federal government borrows money by selling U.S. Treasury bonds, bills, and other securities.

Detailed explanation-3: -In this report, the Congressional Budget Office describes its projections of the federal budget and the U.S. economy under current law for this year and the decade that follows. The deficit is projected to total $1.4 trillion in 2023; annual deficits average $2.0 trillion over the 2024–2033 period.

Detailed explanation-4: -If there is a budget deficit, the government can finance it through taxation, borrowing, or printing money. When a government borrows from its central bank or prints money to fill the gap between its income and expenditure, it is called deficit financing.

Detailed explanation-5: -A budgetary deficit is referred to as the situation in which the spending is more than the income. Although it is mostly used for governments, this can also be broadly applied to individuals and businesses.