What is a balanced budget?
A)It is the equality of tax revenues and government spending on goods and services.
B)It is the equality of net tax revenues and government spending on goods and services
C)It is the absence of government debt.
D)It is a budget where the government spends over many categories in a balanced fashion.

Question

Quizplus · Accepted Answer

A balanced budget refers to the equality of net tax revenues (tax revenues minus transfer payments) and government spending on goods and services. This means that the government is not running a deficit (spending more than it takes in) or a surplus (taking in more than it spends). Option A is incorrect as it only refers to tax revenues, not net tax revenues. Option C is incorrect as a balanced budget can still exist even if there is government debt, as long as the debt is stable and manageable. Option D is incorrect as it does not accurately describe a balanced budget.

What Is a Balanced Budget