Through the 1990s, the government of the country of Lydia spent much more than it
received in taxes. Because of this, Lydia
owed $100 billion in 2002. However, for the
past two years Lydia has taken in $5 billion
more in taxes per year than it has spent.
Which of the following can accurately be
said of Lydia?
A Lydia ran budget surpluses in the
1990s, but now it is out of debt.
B Lydia is now experiencing budget
surpluses, but it is still in debt.
C Lydia ran budget deficits in the 1990s,
but is now out of debt.
D Lydia is now experiencing budget
deficits, but is still in debt.