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Question
Assertion (A): Fiscal deficit is measured in terms of borrowings.
Reason (R): External borrowings increases the Fiscal deficit.
Options
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).
Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
Assertion (A) is true, but Reason (R) is false.
Assertion (A) is false, but Reason (R) is true.
MCQ
Solution
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).
Explanation:
The difference between total expenditure and total receipts, excluding borrowings, is known as the fiscal deficit. It indicates the government's borrowing needs.
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Measures of Government Deficit Or Surpluses
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