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Question

Fiscal Deficit is the difference between:

  1. Total Revenue and Total Expenditure
  2. Revenue Receipts and Revenue Expenditure
  3. Total Expenditure and Revenue Receipts plus Non-debt creating capital receipts
  4. Capital Expenditure and Capital Receipts

Answer:

Option C: Total Expenditure and Revenue Receipts plus Non-debt creating capital receipts

Detailed Solution:

The correct answer is “Total Expenditure and Revenue Receipts plus Non-debt creating capital receipts”.

Fiscal deficit is the excess of total expenditure (revenue expenditure + capital expenditure) over total receipts (revenue receipts + non-debt creating capital receipts).