Understanding Government Budget Terms

What is an outlay?

• An expense or "outflow" of money

• An intake of money from taxes

• The amount a government spends over what it takes in

• The amount extra that the government has after outlays are paid

What is a receipt?

• An expense or "outflow" of money

• An intake of money from taxes

• The amount a government spends over what it takes in

• The amount extra that the government has after outlays are paid

What is a deficit?

• An expense or "outflow" of money

• An intake of money from taxes

• The amount a government spends over what it takes in

• The amount extra that the government has after outlays are paid

What is a surplus?

• An expense or "outflow" of money

• An intake of money from taxes

• The amount a government spends over what it takes in

• The amount extra that the government has after outlays are paid

What is a balanced budget?

• An expense or "outflow" of money

• An intake of money from taxes

• The amount a government spends over what it takes in

• One in which outlays equal receipts

Which of the following is an economic function of the government?

• Safeguarding competition and the market system

• Promoting private monopolies

• Increasing inflation

• Reducing public services

What is one of the roles of the government in the economy?

• Providing public goods and services

• Limiting public goods and services

• Promoting harmful externalities

• Reducing economic stability

How does the government address harmful externalities?

• Correcting for harmful externalities

• Ignoring harmful externalities

• Promoting harmful externalities

• Reducing public services

Which function of the government helps in maintaining economic stability?

• Maintaining economic stability

• Promoting economic instability

• Reducing public services

• Increasing inflation

What is one way the government redistributes wealth?

• Redistributing income and wealth

• Promoting private monopolies

• Increasing inflation

• Reducing public services