Question

Which statements accurately describe debts and deficits? Select all that apply.
O The deficit is the amount a government spends above what it brings in.
O The government's debt represents how much it owes from borrowing to pay for expenditures.
O Deficits cause debt to decrease.
. Deficits cause debt to increase.
. Debt iS free and has few consequences for the government.
0 Debt requires a government to pay back more than it has borrowed.

Answer 1

The difference between a government's spending and its revenue is known as the deficit.

The amount the government owes as a result of borrowing money to cover expenses is represented by its debt.

Briefing:-

Debt rises as a result of deficits.

A government with debt must repay more than it has borrowed.

Of the following, which best describes a deficit?

A deficit happens in the financial sense when liabilities exceed assets, imports exceed exports, or expenses exceed revenues. A surplus is the opposite of a deficit, which is a deficiency or loss.

What do deficits and debts mean?

Deficit refers to a scenario where expenses exceed earnings or liabilities outweigh assets, whereas debt is any money due to someone else. Debt is, to put it simply, the result of years of deficit and sporadic excess.

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