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Question : A government budget deficit occurs when:

Option 1: Revenues exceed expenditures
 

Option 2: Expenditures exceed revenues
 

Option 3: The budget is balanced

 

Option 4: There are no revenues or expenditures


Team Careers360 17th Jan, 2024
Answer (1)
Team Careers360 19th Jan, 2024

Correct Answer: Expenditures exceed revenues
 


Solution : The correct answer is (b) Expenditures exceed revenues.

A budget deficit happens when the government's total expenditures or spending exceed its total revenues or income during a specific period, such as a fiscal year. In other words, the government is spending more money than it is earning from various sources such as taxes, fees, and other revenue streams.

 

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