When a Government Has a Budget Surplus, the Surplus

question 128

Multiple Choice

When a government has a budget surplus, the surplus

• A) helps finance investment.
• B) crowds-out private saving.
• C) must be subtracted from private saving to get total saving.
• D) increases the world real interest rate.

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Definitions:

Journal Entry

A record in accounting that notes the details of a financial transaction as it happens.

Stockholders' Equity

Represents the residual interest in the assets of a corporation after deducting liabilities. It typically includes common stock, preferred stock, retained earnings, and treasury stock.

Balance Sheet

A report detailing a corporation's assets, liabilities, and equity of its shareholders at a certain moment.