Question

When expenditure is greater than income, government borrows from ____.

• A. banks
• B. people within the country
• C. international financial institutions
• D. all of the above

Answer 1

The correct option is D all of the above

For implementing various policies and its general administration, the government generates funds from various sources such as taxation, running of public sector enterprises etc. When expenditure is more than income, the government borrows to finance the deficit from banks and also from people within the country and from international financial institutions.