Chapter 14: Deficit Spending and the Public Debt

Question 1

A Budget Deficit is

Answer 1

excess government spending over government revenues. (us now since the 1940s for fed. gov.)

Question 2

A Balanced Budget is

Answer 2

A situation where the government’s expenditures equal its revenue

Question 3

A Budget Surplus is

Answer 3

An excess of government revenues over government spending during a given period of time. (it’s the best opportunity to lower its national debt when this happens)

Question 4

Gross Public Debt is

Answer 4

All federal government debt regardless of who owns it. (it is overstated because the federal government owes itself money)

Question 5

Net Public Debt equals

Answer 5

Gross gov. debt minus all government interagency borrowing.

Question 6

Entitlements are

Answer 6

Guaranteed benefits under a government program such as Social Security, Medicare, or Medicaid.
(non-discretionary expenditures that have been legislated by Congress.)