| 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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