Question

If the U.S. federal government's expenditures exceeded its receipts, it would likely a. lend money to a bank or other financial intermediary. b. sell bonds directly to the public. c. buy bonds directly from the public d. borrow money from a bank or other financial intermediary.

Answer 1

Answer:

Directly sell bonds to the public

Explanation:

Financial System

This is simply called an Institutions in the economy of any country that is concerned matching one person's saving with another individual's investment collectively. They save and lends money to the public.

When the government's expenditures is far greater than its receipts, they would likely directly sell bonds to the public. The expenditures of government always goes on goods, services, or transfer payments and when they become bigger than their tax revenue, the government therefore runs into a budget deficit. This can therefore make a government borrow some amount of money from financial system to pay for budget deficits, and the results of government borrowing can increase a nation's debt rate.

A Bond

A certificate othat shows one is indebted as it shows or specifies the obligations of the borrower to the holder.