Question

A Surplus Budget is one in which:

Options

• \[\text{Government expenditure} = 0\]

• \[\text{Government receipts} < \text{Government expenditure}\]

• \[\text{Government receipts} = \text{Government expenditure}\]

• \[\text{Government receipts} > \text{Government expenditure}\]

Answer 1

In a Surplus Budget, government receipts exceed government expenditure, i.e., receipts are greater than expenditure. Such a budget is used during inflation to reduce aggregate demand.