A budget deficit exists when b) government spending exceeds tax collections for a given period.
In simpler terms, a budget deficit occurs when a government’s expenditures surpass its revenues within a specific time frame, usually a fiscal year. This means that the government is spending more money than it is bringing in through taxes and other income. Over time, recurring budget deficits can lead to increased national debt, as the government may need to borrow to cover the gap between what it collects and what it spends.