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Questions
Define the following term:
Fiscal deficit
Define fiscal policy.
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Solution
Fiscal deficit refers to the total amount of borrowing required by the government to finance its budget deficit, i.e., the excess of government expenditure over government revenue.
RELATED QUESTIONS
Which of the following is an advantage of direct taxes?
Instruments of fiscal policy is:
The state can promote economic development by ______.
State two objectives of fiscal policy.
'The role of the State is important in developing the economic infrastructure of a developing economy'. Give two reasons to support your answer.
Explain how indirect taxes can be inflationary.
Which one is better progressive or regressive taxation and why?
An indirect tax can be made progressive by imposing higher tax rates on luxuries. Justify the above statement.
Draw a neat labelled diagram for progressive taxation.
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