Question

The revenue expenditure of a government is ₹300 crore. The revenue receipts of the same government are ₹400 crore.

Which of the following is correct?

• A. There is a revenue deficit of ₹100 crore
• B. There is a revenue deficit of ₹700 crore
• C. There is a revenue deficit of ₹350 crore
• D. There is no revenue deficit.

Answer 1

The correct option is D There is no revenue deficit.

Revenue deficit is the excess of a government’s revenue expenditure over revenue receipts. Here, the revenue expenditure of the government ₹300 crore, which is less than the revenue receipts of ₹400 crore. Hence, there is no revenue deficit. Moreover, the government has an excess of ₹100 crore to spend.