What is the difference between the federal budget deficit and the national debt? a. The budget deficit is the amount by which expenditures exceed revenues in a particular year, while the national debt is the cumulative effect of all past budget deficits and surpluses. b. The budget deficit is the cumulative effect of all prior national debts. c. The national debt includes all outstanding bonds, while the budget deficit excludes bonds held by government agencies. d. This is a trick question because there is no difference between the budget deficit and the national debt.
What is the difference between the federal budget deficit and the national debt? a. The budget deficit is the amount by which expenditures exceed revenues in a particular year, while the national debt is the cumulative effect of all past budget deficits and surpluses. b. The budget deficit is the cumulative effect of all prior national debts. c. The national debt includes all outstanding bonds, while the budget deficit excludes bonds held by government agencies. d. This is a trick question because there is no difference between the budget deficit and the national debt.
Chapter17: Federal Deficits, Surpluses, And The National Debt
Section: Chapter Questions
Problem 7SQP
Related questions
Question
What is the difference between the federal budget deficit and the national debt?
| a. |
The budget deficit is the amount by which expenditures exceed revenues in a particular year, while the national debt is the cumulative effect of all past budget deficits and surpluses.
|
|
| b. |
The budget deficit is the cumulative effect of all prior national debts.
|
|
| c. |
The national debt includes all outstanding bonds, while the budget deficit excludes bonds held by government agencies.
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|
| d. |
This is a trick question because there is no difference between the budget deficit and the national debt.
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Expert Solution
Step 1
The budget deficit occurs when the current expenses exceed the revenue of an economy. This may occur because of unanticipated events and policies.
National debt refers to the public/intragovernmental obligations which the federal government owns.
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