Question

Which of the following formulas correctly defines the Revenue Deficit?

Options

• \[ \text{Revenue Deficit} = \text{Fiscal Deficit} - \text{Interest Payments} \]

• \[ \text{Revenue Deficit} = \text{Total Expenditure} - \text{Revenue Receipts} \]

• \[ \text{Revenue Deficit} = \text{Revenue Receipts} - \text{Revenue Expenditure} \]

• \[ \text{Revenue Deficit} = \text{Revenue Expenditure} - \text{Revenue Receipts} \]

Answer 1

The Revenue Deficit is the excess of revenue expenditure over revenue receipts: \[ \text{Revenue Deficit} = \text{Revenue Expenditure} - \text{Revenue Receipts} \]. Reversing the terms would give a negative figure, and the last option defines the Primary Deficit.