Primary Deficit can be zero if? Option 1: Fiscal Deficit = Interest Payments. Option 2: Fiscal Deficit > Interest Payments. Option 3: Revenue deficit < Interest payments. Option 4: Fiscal Deficit < Interest Payments.

Answer: Fiscal Deficit = Interest Payments. Solution: Option 1 -> Primary Deficit = Fiscal Deficit - Interest Payments. If Fiscal Deficit = Interest Payments, then Primary Deficit = 0. Option 2 -> If Fiscal Deficit > Interest Payments, Primary Deficit would be positive, not zero. Option 3 -> Revenue deficit relation to interest payments doesn't determine Primary Deficit, which is based on Fiscal Deficit. Option 4 -> If Fiscal Deficit Hence, Option 1: Fiscal Deficit = Interest Payments -> Primary Deficit is calculated as Fiscal Deficit minus Interest Payments. When these two values are equal, their difference becomes zero. This means the government's borrowing requirement (fiscal deficit) is entirely due to interest obligations on past debt, with no additional borrowing needed for current expenditure exceeding revenue -> correct

Macro

Government Budget

Medium

Primary Deficit can be zero if?

Fiscal Deficit = Interest Payments.

Fiscal Deficit > Interest Payments.

Revenue deficit < Interest payments.

Fiscal Deficit < Interest Payments.

✅ Correct Option: 1

Option 1 -> Primary Deficit = Fiscal Deficit - Interest Payments. If Fiscal Deficit = Interest Payments, then Primary Deficit = 0.

Option 2 -> If Fiscal Deficit > Interest Payments, Primary Deficit would be positive, not zero.

Option 3 -> Revenue deficit relation to interest payments doesn't determine Primary Deficit, which is based on Fiscal Deficit.

Option 4 -> If Fiscal Deficit < Interest Payments, Primary Deficit would be negative, not zero.

Hence, Option 1: Fiscal Deficit = Interest Payments -> Primary Deficit is calculated as Fiscal Deficit minus Interest Payments. When these two values are equal, their difference becomes zero. This means the government's borrowing requirement (fiscal deficit) is entirely due to interest obligations on past debt, with no additional borrowing needed for current expenditure exceeding revenue -> correct

2025: 27 May Shift 2

The government imposes taxes that do not depend on income is called.

2025: 22 May Shift 2

Identify the tax imposed by the government that do not depend on income.

2023: 20 June Shift 1

Choose the correct example of Revenue Expenditure.

2025: 30 May Shift 1

Arrange the steps involved in preparation of the government budget.

(A) Discussion and approval by the parliament.

(B) Preparation of budget by the Ministry of Finance.

(D) Approval by the Cabinet.

Choose the correct answer from the options given below:

2023: 1 June Shift 1

Which of the following products have been kept out of GST for the time being but with passage of time it will get subsumed in GST ?

2025: 2 June Shift 1

Identify which of the following statements are correct?

(A) Fiscal deficit is the difference between total revenue and total expenditure excluding borrowing of the government.

(B) Fiscal deficit is the difference between total planned expenditure and total planned receipts of the government.

(D) Fiscal deficit is the sum of primary deficit and interest payment.

Choose the correct answer from the options given below:

Primary Deficit can be zero if?

Solution

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