F. Describe the difference between the national debt and government deficits.

Let’s look at BUDGET DEFICIT….

In Simple Terms ---- a budget deficit is the difference between what the federal government spends (called outlays) and what it takes in (called revenue or receipts).

A Budget Deficit is an indicator of financial health in which expenditures exceed revenue. The term budget deficit is most commonly used to refer to government spending rather than business or individual spending, but can be applied to all of these entities.

Real World Application: http://federal-budget.insidegov.com/l/119/2016#Overview&s=2WS4y3 Write these questions down: What is our current GDP? What is “Receipts” and how much is it? What are “outlays” and how much is it? During Obama’s administration, did our deficit go up or down? Where does most of the government’s revenue come from? What is it mostly spent on?

NATIONAL DEBT

In simple terms The national debt, also known as the public debt, is the result of the federal government borrowing money to cover years and years of budget deficits.

What does it mean? the amount owed by the federal government of the United States. A deficit year increases the debt because more money is spent than is received; a surplus year decreases the debt because more money is received than spent. According to the chart is our debt greater than our GDP?

Are you ready for this? Can you read it using what you’ve learned? http://www.usdebtclock.org/