The correct answer is: B) Deficit
A deficit is the difference between a government’s revenue and expenditures when expenditures exceed revenue. A government budget deficit occurs when the government spends more money than it takes in through taxes and other revenue sources. The government can finance a budget deficit by borrowing money, which increases the national debt.
A surplus is the opposite of a deficit. It occurs when a government’s revenue exceeds its expenditures. A government budget surplus can be used to pay down the national debt, invest in infrastructure, or provide tax cuts.
Debt is the total amount of money that a government owes. It is the sum of all the government’s outstanding loans, including Treasury bills, notes, and bonds. The national debt is the total amount of debt that the federal government owes.
The balance of payments is a statement of all the economic transactions between a country and the rest of the world. It includes exports, imports, income from investments, and other payments. A country’s balance of payments can be in surplus, deficit, or equilibrium.