Multiple choice

If borrowings and other liabilities are added to the budget deficit, we get

  1. revenue deficit

  2. capital deficit

  3. primary deficit

  4. fiscal deficit

Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Fiscal deficit is calculated by adding borrowings and other liabilities to the budget deficit. Budget deficit is the excess of expenditure over revenue, while fiscal deficit includes the borrowing requirement to finance this gap. Revenue deficit and capital deficit are different concepts, and primary deficit excludes interest payments.

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