Question

Find borrowing by Government if payments of interest is estimated to be of ₹. 15,000 crores
which is 25% of primary deficit.

Answer 1

Government borrowing is 60,000.

GIVEN:  Interest = 15,000; 25% of primary deficit

TO FIND: Borrowing by government

SOLUTION:

Interest Payment = 15,000

Interest Payment = 25% of primary deficit

Let the primary deficit be x.

25% of x = 15,000

$\frac{25}{100}$ × x = 15,000

So, Primary Deficit = $\frac{100}{25}$ × 15,000

                              = 60,000

The primary deficit is 60,000.

Borrowing is a loan taken by the government and falls under capital receipts.

Primary deficit refers to the difference between the current year's fiscal deficit and interest payment on previous borrowings.

The primary deficit is 60,000

PROJECT CODE #SPJ3