Give the relationship between the revenue deficit and the fiscal defic

1.	Give the relationship between the revenue deficit and the fiscal deficit.
Answer» The relationship between the revenue deficit and the fiscal deficit can be explained through the following points: i. Revenue deficit is the difference between government's revenue expenditures and government's receipts. Revenue deficit = Revenue expenditures - Revenue receipts On the other hand, fiscal deficit is the difference between the total expenditure and the total receipt of the government. Fiscal deficit = Total Expenditure - Total Receipts (excluding borrowings) ii. The term 'fiscal deficit' is used in a broader sense than the term 'revenue deficit'. iii. As revenue deficit increases, the proportion of fiscal deficit also increases.

Give the relationship between the revenue deficit and the fiscal deficit.

Answer»

The relationship between the revenue deficit and the fiscal deficit can be explained through the following points:

i. Revenue deficit is the difference between government's revenue expenditures and government's receipts.

Revenue deficit = Revenue expenditures - Revenue receipts

On the other hand, fiscal deficit is the difference between the total expenditure and the total receipt of the government.

Fiscal deficit = Total Expenditure - Total Receipts (excluding borrowings)

ii. The term 'fiscal deficit' is used in a broader sense than the term 'revenue deficit'.

iii. As revenue deficit increases, the proportion of fiscal deficit also increases.

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