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Q · Budget and Its TypesMedium · 45s
Why is the Fiscal Deficit considered a better indicator of fiscal health compared to the Budget Deficit?
TopicBudget and Its Types
Question Typemultiple choice
DifficultyMedium
Marking+1 / −0.33
Test Duration30 min
Step-by-Step Solution
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Fiscal Deficit captures the total shortfall, including revenue and capital expenditures minus non-borrowed receipts. It indicates the actual borrowing the government needs, unlike the Budget Deficit, which considers only the revenue shortfall.
Final Answer: Option B - It reflects the government's actual borrowing requirements.