Final answer:
The federal government's 2008-2009 stimulus spending was an example of expansionary fiscal policy used during the recession, not expansionary sound finance, making the statement False.
Step-by-step explanation:
The 2008-2009 deficit stimulus spending by the federal government is an example of expansionary fiscal policy, not expansionary sound finance. This statement in the question is False. During a recession, governments often employ such policies, which can include both tax cuts and spending increases, to stimulate economic activity. The 2008-2009 stimulus was introduced to address the effects of the Great Recession and comprised an $830 billion package that included both aspects.
Despite budget deficits in 2003 and 2004, and a continuation in the late 2000s, the U.S. federal government actually ran budget surpluses from 1998-2001. Therefore, the statement about budget deficits being an example of sound finance is inaccurate.