Q. A country’s fiscal deficit stands at ₹ 50,000 crores. It is receiving ₹ 10,000 crores through non-debt creating capital receipts. The country’s interest liabilities are ₹ 1,500 crores. What is the gross primary deficit?
Answer: A
Notes:
Exp) Option a is the correct answer.
To find the Gross Primary Deficit, we need to use the following formula:
Gross Primary Deficit=Fiscal Deficit−Interest Payments
Given:
- Fiscal Deficit = ₹50,000 crores
- Interest Liabilities = ₹1,500 crores
- Non-debt creating capital receipts are not needed to calculate the Primary Deficit directly. They are part of the financing of the fiscal deficit but do not affect the primary deficit calculation.
Gross Primary Deficit = 50,000 − 1,500 = 48,500 crores
Source:Class 12 macroeconomy NCERT
https://nios.ac.in/media/documents/SrSec318NEW/318_Economics_Eng/318_Economics_Eng_Lesson29.pdf
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