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Complete the three deficit formulas.

Exercise and reference answers

Missing parts
  1. Answer
    revenue receipts
    Choices
    1. revenue receipts
    2. capital receipts
    3. total borrowings
  2. Answer
    non-debt creating capital receipts
    Choices
    1. non-debt creating capital receipts
    2. market borrowings
    3. interest payments
  3. Answer
    interest payments
    Choices
    1. interest payments
    2. major subsidies
    3. defence spending
Complete the statement
Revenue deficit = revenue expenditure minus {0}. Fiscal deficit = total expenditure minus revenue receipts and {1}. Primary deficit = fiscal deficit minus {2}.
Instructions
Choose the right term for each blank.

Explanation

Revenue deficit compares the two revenue-account sides. Fiscal deficit excludes borrowing from the receipts side, since borrowing is exactly what it measures so only revenue receipts and non-debt creating capital receipts count. Primary deficit strips out interest on past debt to expose the current imbalance.
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