Assertion (A): Repayment of loans by the government is the capital expenditure of the government.
Reason (R): Capital expenditure of government leads to the creation of assets or reduction in liabilities.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Receipts of Post office Savings Accounts, National Savings Certificates, etc. are capital receipts.
Reason (R): Small savings of people (Post office Savings Accounts, National Savings Certificates, etc) are capital receipts for the government because these receipts create a liability of repayment on government.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Primary deficit = Fiscal deficit – Net interest liabilities
Reason (R): Net interest liabilities consist of interest payments minus interest receipts by the government on net domestic lending.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Repayment of borrowings is a capital expenditure.
Reason (R): Capital Expenditure reduces the liability of the government.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Fiscal deficit indicates the total borrowing requirements of the government from all sources.
Reason (R): Fiscal deficit is financed through borrowings. From the financing side: Fiscal deficit = Net borrowing at home + Borrowing from RBI + Borrowing from abroad.
Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Defence services expenditure is a revenue expenditure.
Reason (R): Defence services expenditure is a revenue expenditure because it neither creates any asset nor reduces any liability of the government.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): The impact and incidence of indirect tax lie on different persons
Reason (R): Indirect Taxes can be avoided by not entering into those transactions, which call for such taxes.
Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): The government has allocated extra money in Budget 2021 to provide safe drinking water facilities and sanitation to the people.
Reason (R): The government does it because sanitation and providing drinking water are public goods.
Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Government imposes heavy taxes on alcohol and gives subsidies of LPG gas.
Reason (R): The government undertakes such a measure to ensure economic stability in the government.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Fiscal deficits are always inflationary.
Reason (R): Fiscal deficit equals borrowings of the government. Such borrowings are generally financed by issuing new currency which may lead to inflation.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.