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Questions
Explain 'Revenue Deficit in a Government budget? What does it indicate?
What is revenue deficit in government budget?
Explain the meaning of Revenue deficit
What is revenue deficit?
Define revenue deficit
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Solution
Revenue deficit means the excess of revenue expenditure of the government over its revenue receipts.
Revenue deficit = Revenue expenditure − Revenue receipts
Revenue deficit is indicated to the government as follows:
- Regular receipts of the government are not enough to meet regular expenditures.
- The government is using up savings of other sectors of the economy to meet its consumption expenditure.
- This gives a signal to either reduce its expenditure or increase its revenue. Curtail expenditure by taking steps to avoid unproductive expenses and increase revenue from various sources of tax and non-tax revenues
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RELATED QUESTIONS
Fiscal deficit equals :
(a) Interest payments
(b) Borrowings
(c) Interest payments less borrowing
(d) Borrowing less interest payments
Distinguish between revenue deficit and fiscal deficit.
Define fiscal deficit.
‘The fiscal deficit gives the borrowing requirement of the government’. Elucidate.
Consider an economy described by the following functions:- C = 20 + 0.80Y, I = 30, G = 50, TR = 100 (a) Find the equilibrium level of income and the autonomous expenditure multiplier in the model. (b) If government expenditure increases by 30, what is the impact on equilibrium income? (c) If a lump-sum tax of 30 is added to pay for the increase in government purchases, how will equilibrium income change?
Explain why the tax multiplier is smaller in absolute value than the government expenditure multiplier.
Explain the relation between government deficit and government debt.
Does public debt impose a burden? Explain.
Are fiscal deficits inflationary?
Regressive tax is that which is ______.
| S. No. | Content | Rs (in crores) |
| 1. | Revenue Expenditure | 100 |
| 2. | Capital Receipts | 40 |
| 3. | Net Borrowings | 38 |
| 4. | Net Interest Payments | 27 |
| 5. | Tax Revenue | 50 |
| 6. | Non-tax Revenue | 15 |
Which of the following is MOST LIKELY to be the main contributor to the fiscal deficit in this case?
Read the following statements carefully and choose the correct alternatives given below:
Statement 1: Fiscal Deficit = Total Budget Expenditure - Total Budget Receipts (Net of borrowing)
Statement 2: Primary Deficit = Fiscal Deficit + Interest Payments.
When the revenue receipts are less than the revenue expenditures in a government budget, this shortfall is termed as
Primary deficit is borrowing requirements of government for making:
Fiscal Deficit equals:
Identify which of the following statements is true.
On the basis of the given information, calculate the value of:
- Fiscal deficit
- Primary deficit
| S.No. | Items | 2021-22 (₹ in crore) |
| (i) | Revenue Receipts | 20 |
| (ii) | Capital Expenditure | 15 |
| (iii) | Revenue Deficit | 10 |
| (iv) | Non-debt creating capital receipts | 50% of revenue receipts |
| (v) | Interest Payments | 4 |
