Fiscal deficit is equal to excess of total expenditure over the sum of revenue receipts and capital receipts excluding borrowings. ie. Fiscal deficit means borrowing of the government. Fiscal Deficit :– Total expenditure – Total receipts net of borrowings Implication of Fiscal deficit 1. It increase the supply of money in the economy 2. it increase financial burden for future generation. 3. it is cause of inflation.
What is meant by fiscal deficit. Write its implications.
Answers
Akanksha
Fiscal deficit is equal to excess of total expenditure over the sum of revenue receipts and capital receipts excluding borrowings. ie. Fiscal deficit means borrowing of the government.
Fiscal Deficit :– Total expenditure – Total receipts net of borrowings Implication of Fiscal deficit
1. It increase the supply of money in the economy
2. it increase financial burden for future generation.
3. it is cause of inflation.