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A binding agreement by a government agency to pay for goods, products, services, studies, and the like, either immediately or in the future.
When an agency enters into such an agreement, it incurs an obligation. As the agency makes the required payments, it liquidates the obligation.
SOURCE: House Budget Committee
See all terms in the National Debt Glossary
Frequently Asked Questions: National Debt
- How did the national debt get to be so big?
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