Question

Primary deficit in a government budget is : (Choose the correct alternative)

a. Revenue expenditure - Revenue receipts
b. Total expenditure - Total receipts
c. Revenue deficit - Interest payments
d. Fiscal deficit - Interest payments

Answer 1

Fiscal deficit - Interest payments

Primary deficit is the difference between the fiscal deficit and interest payment.
Primary deficit = Fiscal deficit − Interest payment
It determines the amount of borrowing which is necessary for the government to pay for the expenses other than interest payments