Payment to liquidate an obligation other than repayment of debt principal.

• A. Outlay
• B. Revenue
• C. Deficit
• D. Discretionary Spending

Answer: (A)

In budgeting terms, an outlay is a cash disbursement that settles an obligation. When the government pays to fulfill a commitment—such as paying a supplier, contractor, or program—this cash exit is an outlay. The question describes a payment that liquidates an obligation other than repayment of debt principal, which still falls under the general idea of an outlay, since it is a cash disbursement to satisfy a obligation. Revenue is money received, not a payment to settle obligations. A deficit is the shortfall between outlays and revenues, not a type of payment. Discretionary spending refers to the portion of outlays subject to annual appropriations, not the act of liquidating obligations itself. So the best answer is outlay.