What is relationship between public expenditure and fiscal deficit?
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Public (Fiscal) expenditure refers to governmental budgetary expenditure, that is the total sum of planned and non-planned expenditure or a sum of capital and revenue expenditure effective from Budget2016–17.
Now,
Fiscal Deficit= {(Fiscal Expenditure- Fiscal Revenue)/ Fiscal Revenue}*100.
Hence, public expenditure and fiscal deficit are directly proportional, in the sense that an increase in the former leads to proportional increase in the latter (if it is >fiscal revenue).
Now,
Fiscal Deficit= {(Fiscal Expenditure- Fiscal Revenue)/ Fiscal Revenue}*100.
Hence, public expenditure and fiscal deficit are directly proportional, in the sense that an increase in the former leads to proportional increase in the latter (if it is >fiscal revenue).
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