Public Finance: UPSC Previous Year Questions (Indian Economy)
1 previous year UPSC Prelims question on Public Finance (Indian Economy). Choose an option to see the answer and explanation.
Explanations state facts as of the year each question was asked; words like “recently” refer to that year.
Showing 1–1 of 1 question
UPSC 1999Indian Economy · Public Finance
Q1. Assertion (A): Fiscal deficit is greater than budgetary deficit. Reason (R): Fiscal deficit is the borrowing from the Reserve Bank of India plus other liabilities of the Government to meet its expenditure.
Explanation
Assertion (A) is true: The fiscal deficit is the difference between the government’s total expenditure and its total non-debt receipts (revenue receipts plus non-debt capital receipts). It represents the total borrowing requirement of the government. Budgetary Deficit can be termed as the excess of the total government expenditure over the total revenue generated in a financial year. The fiscal deficit is always greater than or equal to the budgetary deficit. This is because the fiscal deficit includes all borrowings, while the budgetary deficit only looks at the gap in the revenue account. The fiscal deficit includes borrowing to finance capital expenditure (investments in infrastructure, etc.), which is not part of the revenue account. Reason (R) is false: This is because the fiscal deficit is not solely borrowing from the Reserve Bank of India. It includes borrowing from the public, financial institutions, and external sources, as well as other liabilities like market loans and securities.
Answer key for these questions
Q
UPSC year
Correct answer
1
1999
(c) A is true but R is false
Frequently asked questions
How many previous year UPSC questions are there on Public Finance?
This page covers 1 previous year UPSC Prelims GS Paper-I questions on Public Finance (Indian Economy), asked from 1997 to 2025. Each has the correct answer and an explanation.
How should I use previous year UPSC questions for Prelims?
Attempt each question first, then open the answer and read the explanation for every option. Repeat by chapter, and track which statements UPSC reuses across years. Previous year questions show the exam pattern and difficulty level.
Which years are covered for Public Finance?
Questions on Public Finance (Indian Economy) are available for 15 years, from 1997 to 2025. Use the Year filter to practise a single paper.
