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Name__________________________________________________

Economics Dr. Sauer

Ch 4: Government II worksheet 1. The following graphic illustrates the US government budget for 2011.

The three main sources of government tax revenue are: Discretionary spending can be changed each year according to spending priorities. The biggest chunk of discretionary spending goes toward: Mandatory spending cannot be changed without changing many existing laws. The 4 main categories of mandatory spending are: Paying interest on the debt is technically not mandatory, however, if we didnt pay it as a nation we would be defaulting on our debt. If taxes arent increased, how much of the discretionary budget would have to be cut in order to balance the budget?

2. The President has released his 2012 Budget proposal. In it, the US governments tax revenues are estimated to be $2.627 trillion and government spending is estimated to be $3.729 trillion. Calculate the 2012 estimated budget deficit or surplus. Explain what your answer means.