ECONOMICS
MONEY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Harold Daley budgeted $210 for food for the month of July. He spent $227 on food during July. Does he have a budget surplus or deficit, and what amount?
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Surplus, $17
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Deficit, $17
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Surplus, $10
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Deficit, $10
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Explanation:
Detailed explanation-1: -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 occurs when tax revenue is greater than government spending. With a budget surplus, the government can use the surplus revenue to pay off public sector debt. Budget surpluses are quite rare in modern economies because of the temptation for politicians to spend more money and cut taxes.
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