Question:
The ‘Primary Deficit’ in the government budget is defined as:
(1) Fiscal Deficit + Interest Payments.
(2) Fiscal Deficit – Interest Payments.
(3) Total Revenue – Total Expenditure.
(4) Current Expenditure – Capital Expenditure.
(5) Public Debt – Foreign Reserves.
Correct Answer:
(2)
Answer Explanation:
The Primary Deficit shows the gap between government spending and revenue excluding the cost of past borrowing (interest). It is a key measure of current fiscal discipline.
Topic: Public Finance Year: 2024
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