Multiple choice

The Budget deficit refers to the difference between all revenues and expenditures of

  1. revenue account only

  2. capital account only

  3. both revenue and capital accounts

  4. increased Govt. expenditure

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

The budget deficit is the difference between total government revenue and total government expenditure, covering both revenue and capital accounts. It represents the total amount the government needs to borrow in a financial year. This includes both the revenue deficit (difference between revenue receipts and revenue expenditure) and capital account differences.