GyanGramThere has been a persistent deficit budget year after year. Which action/actions of the following can be take…
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There has been a persistent deficit budget year after year. Which action/actions of the following can be taken by the Government to reduce the deficit?
1. Reducing revenue expenditure
2. Introducing new welfare schemes
3. Rationalizing subsidies
4. Reducing import duty
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• Correct Answer: C
• Reducing revenue expenditure and rationalizing subsidies directly lower government spending, narrowing the fiscal deficit.
• New welfare schemes increase expenditure; reducing import duty lowers revenue, both widening the deficit.
• B, D are wrong as they include deficit-widening measures.
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