Revenue Expenditure= 22,250
Capital Expenditure= 28,000
Revenue Receipts=17,750
Capital receipts (Net of Borrowings) =20,000
Borrowings=12,500
Interest Payment= 5,000
What will be the fiscal deficit?
Answer & explanation
Correct answer: option 3
The correct answer is option 3: 12,500
Fiscal deficit is calculated by deducting total receipts( excluding borrowing) from total expenditure.
Fiscal Deficit= Revenue Expenditure+ Capital Expenditure-Revenue Receipts- Capital Receipts (Net of Borrowings)
= 22,250+28,000-17,750-20,000
=12,500