UPSC General Studies Sample Paper General Studies Sample Paper-10

  • question_answer
    Which of the following statement(s) is/are correct?
    1. The capital budget is an account of the assets as well as liabilities of the Central Government.
    2. The subsidies provided by the Central Government as a percentage of GDP has been declining iron 1991 onwards.
    3. Fiscal deficit is always inflationary.                                                              
    Select the correct answer using the codes given below.                                   

    A)  Only 1

    B)  2 and 3                

    C)                 1 and 3           

    D)  None of these               

    Correct Answer: A

    Solution :

    [a] Fiscal deficit is not always inflationary. It depends whether the increased demand for the good and services is matched by adequate new supplies. The subsidies as a % of GDP has been decreasing till 2005-06, but has then picked up to FY2013-14.                                               

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