Let's assume the estimated income receipts of the government in the budget 2020-21 was Rs. 22000 crore and its estimated expenditure was 25000 crore.

Which of the following option stands true in regards to the above statement?

The budget is in deficit

The correct answer is Option 2:  The budget is in deficit

When the estimated expenditure exceeds the estimated income receipts, we say that the budget is in deficit. There is deficit of 3000 crore.