alleryStart learning →With revenue receipts at 9.2 per cent of GDP and revenue expenditure at 11.8 per cent, the revenue deficit is
A1.4 per cent
B2.6 per cent
C21.0 per cent
D5.6 per cent
Answer & Solution
Correct answer: B. 2.6 per cent
1. Revenue deficit = revenue expenditure - revenue receipts.
2. Substituting: 11.8 - 9.2.
3. = **2.6 per cent of GDP**, matching Table 5.1.
4. 5.6 is the fiscal deficit, a wider measure that also counts capital transactions, so picking it confuses the two.
_Source: syllabus Introductory Macroeconomics, Ch 5 "Government Budget and the Economy", section 5.2.1 Measures of Government Deficit_
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