Certified Government Financial Manager (CGFM) Practice Exam

Question: 1 / 875

What percentage of federal government spending is considered mandatory spending?

One-third

Two-thirds

Mandatory spending refers to those expenditures that are required by law and are not subject to the annual appropriations process. This category primarily includes programs such as Social Security, Medicare, and Medicaid.

The correct answer highlights that approximately two-thirds of federal government spending falls under mandatory spending. This significant proportion reflects the ongoing obligation the federal government has to fund these programs, which are often tied to eligibility criteria rather than appropriated annually by Congress.

In contrast, discretionary spending—which makes up the remaining share of the budget—includes funding that Congress can adjust each year through the appropriations process for programs such as defense, education, and transportation. Understanding the distinction between mandatory and discretionary spending is crucial for grasping how federal budget priorities are structured and the long-term fiscal commitments the government must manage.

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One-half

Three-quarters

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