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Government Budget and Economy — Economics STD 12 Humanities & Commerce — Question

Rajasthan BoardEnglish MediumSTD 12 Humanities & CommerceEconomicsGovernment Budget and Economy3 Marks
Question
What is fiscal deficit? What are its implications?
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Answer

Fiscal deficit means the excess of total expenditure over the total receipts by the government excluding borrowings.

A large fiscal deficit mean large amount of borrowings. This in turn creates burden of interest and loan repayment in the future. It may also be inflationary.

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