Question

Which of the following can be termed as a development expenditure?

• A. Construction of dams for electricity generation
• B. Expenditure on defence and security
• C. Expenses on providing pensions
• D. Expenditure on maintaining law and order

Answer 1

The correct option is A Construction of dams for electricity generation

The expenditures related to activities that promote further development of the nation are classified under development expenditure. For example, the construction of dams adds to the infrastructure of the country. Hence, it is a development expenditure. On the other hand, non-developmental expenditure does not directly help in the economic development of a country, though it is necessary for the smooth functioning of the nation.