The fiscal deficit gives the borrowing requirements of the govt. Elucidate.
Asked by dwivediastha717
5th March 2018,
6:43 PM
Answered by Expert
Answer:
Fiscal deficit refers to the excess of total expenditure over total receipts excluding borrowings. Hence it indicates the total borrowing requirement of the government including interest. This increase the revenue expenditure and it leads to revenue deficit. It creates a vicious circle of fiscal deficit and revenue deficit, where the government takes more loan to repay the earlier loans. Therefore, a country is caught in a debt trap.
Answered by Expert
6th March 2018,
11:17 AM
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