Determine Fiscal deficit from following :

Revenue Receipts = Rs 20 Crores

Revenue Expenditures = Rs 30 Crores

Capital Expenditure = Rs 40 Crores

Borrowings = Rs 15 Crores

15 Crores

The correct answer is option (1) : 15 Crores

1. Fiscal deficit is equal to borrowings because it represents the total amount of money that the government has borrowed to finance its expenditure. Borrowings are an important component of fiscal deficit as they allow the government to finance its expenses when its revenue receipts are not sufficient.

Note: In this question Capital receipts are missing. We can calculate capital receipts by the following formula:

Gross Fiscal Deficit: Total Expenditure of the Government - (Revenue Receipts + Non-Debt Creating Capital Receipts)

15= (30+40)-(20+Capital receipts)

Capital receipts= 35 Cr