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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 revenue deficit? What are its implications?
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Answer

Revenue deficit is the excess of government’s total revenue expenditure over the total revenue receipts.

The deficit is to be covered through borrowings, disinvestment, etc. The borrowing, in turn, leads to the payment of interest and repayment of loans in future which may mean more deficit in future.

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