1. The government of Bugonia will spend $13 millon more this year than it receives in revenue. Which of the following statements can be made with certainty?
A. Bugonia's debt is growing
B. Bugonia is experiencing a budget deficit (I think this is the answer)
C. Bugonia will experience a trade deficit
D. Bugonia will experience a trade surplus

2. Which of the following is a MONETARY policy that might be used to reduce inflation?
A. decreasing taxation
B. decreasing the discount rate
C. open-market sales
D. increasing government spending

3. Due to inflation, the Federal Reserve decides to decrease the money supply. Which of the following will the Federal Reserve MOST LIKELY do?
A. lower the discount rate
B. implement an "easy money" policy
C. buy bonds
D. Raise the reserve requirement for banks

Please help if you can. Thank you!

Question

1. The government of Bugonia will spend $13 millon more this year than it receives in revenue. Which of the following statements can be made with certainty? 
A. Bugonia's debt is growing 
B. Bugonia is experiencing a budget deficit (I think this is the answer)
C. Bugonia will experience a trade deficit 
D. Bugonia will experience a trade surplus

2. Which of the following is a MONETARY policy that might be used to reduce inflation? 
A. decreasing taxation 
B. decreasing the discount rate 
C. open-market sales 
D. increasing government spending

3. Due to inflation, the Federal Reserve decides to decrease the money supply. Which of the following will the Federal Reserve MOST LIKELY do? 
A. lower the discount rate 
B. implement an "easy money" policy 
C. buy bonds 
D. Raise the reserve requirement for banks

Please help if you can. Thank you!