In which situation does the national debt decrease?(1 point)
Responses
The federal government has an increase in the federal deficit from the previous fiscal year.
The federal government has an increase in the federal deficit from the previous fiscal year.
The federal government has a surplus in the budget.
The federal government has a surplus in the budget.
The federal government has a decrease in the federal deficit from the previous fiscal year but still has a deficit.
The federal government has a decrease in the federal deficit from the previous fiscal year but still has a deficit.
The federal government has a balanced budget.
Whats the right answer
The correct answer is: The federal government has a surplus in the budget.
The right answer is:
- The federal government has a surplus in the budget.
The right answer is: "The federal government has a surplus in the budget."
To understand why this is the correct answer, let's break down the options and explain them:
1. The federal government has an increase in the federal deficit from the previous fiscal year.
- This option describes a situation where the federal deficit increases, which means the government is spending more than it is earning. This would actually contribute to an increase in the national debt, rather than decreasing it.
2. The federal government has a surplus in the budget.
- This option describes a situation where the government's income exceeds its spending, resulting in a surplus. In this case, the government would be able to use the surplus to pay off existing debt, leading to a decrease in the national debt.
3. The federal government has a decrease in the federal deficit from the previous fiscal year but still has a deficit.
- Although this option mentions a decrease in the federal deficit, it still states that the government has a deficit. A deficit means the government is spending more than it is earning, so in this situation, the national debt would still be increasing.
4. The federal government has a balanced budget.
- A balanced budget means the government's income matches its spending. While this is a positive scenario, it doesn't directly contribute to decreasing the national debt. The debt would only decrease if the government generates a surplus.
Therefore, the correct option is when the federal government has a surplus in the budget.