ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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a surplus is extra income which is not spent
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a surplus is not enough income
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a surplus decreases the national debt
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a surplus increases the national debt
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Detailed explanation-1: -Key Takeaways. 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.
Detailed explanation-2: -A budget surplus is when the government’s earnings are more than the spending. On the other hand, in a budget deficit, government spending is more than its income. It may happen when the government collects fewer taxes or starts spending more.
Detailed explanation-3: -Unlike the deficit, which drives the amount of money the government borrows in any single year, the debt is the cumulative amount of money the government has borrowed throughout our nation’s history. When the government runs a deficit, the debt increases; when the government runs a surplus, the debt shrinks.
Detailed explanation-4: -The deficit is the addition in the current period (year, quarter, month, etc.) to the outstanding debt. The deficit is negative whenever the value of outstanding debt falls; a negative deficit is called a surplus….