Depending on the relative size of the federal government’s expenditures and tax revenues, the federal government’s budget can be in three possible conditions

What are the three possible conditions and what is the relationship of federal government expenditures and tax revenues for each?

The federal government’s budget could have a budget surplus, a budget deficit, or a balanced budget. A budget surplus occurs when tax revenues are greater than government expenditures; a deficit occurs when tax receipts are less than government expenditures; and a balanced budget occurs when tax revenues are equal to government expenditures.