Question

Which of the following is not a capital receipt?

• A. The government uses its extra income to finance a deficit
• B. The government borrows money to finance a deficit
• C. The government uses its savings to finance a deficit
• D. None of the above

Answer 1

The correct option is A

The government uses its extra income to finance a deficit

Out of the given options, only using extra income to finance deficits does not change the assets or liabilities. Therefore it is not a capital receipt.