UPSC Prelims 2001 · General Studies
Question 73: Economy and Social Development
Match List I with List II and select the correct answer using the codes given below the Lists: List I (Term) I. Fiscal deficit II. Budget deficit III. Revenue deficit IV. Primary deficit List II (Explanation) A) Excess of Total Expenditure over Total Receipts B) Excess of Revenue Expenditure over Revenue Receipts C) Excess of Total Expenditure over Total Receipts less borrowings D) Excess of Total Expenditure over Total Receipts less borrowings and Interest Payments
AnswerThe answer is (a).
Budget deficit is total expenditure minus total receipts; fiscal deficit is total expenditure minus total receipts excluding borrowings; revenue deficit is revenue expenditure minus revenue receipts; and primary deficit is fiscal deficit minus interest payments. Fiscal deficit therefore shows how much the government has to borrow. Remember that primary deficit equals fiscal deficit less interest payments.
- I. Fiscal deficit is expenditure over receipts excluding borrowings.
- II. Budget deficit is total expenditure over total receipts.
- III. Revenue deficit is revenue expenditure over revenue receipts.
- IV. Primary deficit is fiscal deficit less interest payments.
Why each option is right or wrong
- (a) Right: fiscal-C, budget-A, revenue-B, primary-D.
- (b) Only revenue deficit is correctly matched.
- (c) Fiscal and budget deficits are swapped; the other two are right.
- (d) Revenue and primary deficits are swapped; the first two are right.
Explanation: written by UPSC Grade, not by UPSC.
Source: UPSC, Civil Services (Preliminary) Examination 2001, General Studies. UPSC's own paper isn't online; the words are from a published compilation. The paper on upsc.gov.in.