Deficit financing creates additional paper currency to fill the gap between expenditure and revenue. This device aims at economic development but if it fails, it generates : [IFS 1990]

Related MCQs

• Deficit financing leads to inflation in general, but it can be checked if:
• The budget broadly comprises: (i) revenue budget, and (li) capital budget. Which of the following item or items is/are not covered under the revenue budget? I. Different proceeds of taxes and other duties levied by the government II. Interest and dividend on investments made by the government III. Expenditure on running the government and various services IV. Market loans raised by the government
• Oil Pool Deficit is a deficit: 1. in the balance of payments 2. that the government owes to the world bank 3. in the oil pool account 4. that the government owes to the oil companies Choose your answer from:
• Since independence, both development and non-development expenditures have Increased, the increase in the former being a little more than in the other. Non development expenditure involves: 1. interest payment 2. subsidies 3. defence 4. irrigation
• Deficit financing is spending:
• India is a member of which of the following? 1. Asian Development Bank 2. Asia-Pacific Economic Cooperation 3. Colombo Plan 4. Organization for Economic Cooperation and Development (OECD) Select the correct answer using the code given below: [IAS 2008]
• Consider the following actions which the Government can take: 1. Devaluing the domestic currency. 2. Reduction in the export subsidy. 3. Adopting suitable policies which attract greater FDI and more funds from FIIs. Which of the above action/actions can help in reducing the current account deficit? [CSAT 2011]
• Of the various ways of financing government's investment expenditure, the least inflationary is : [PCS 1994]
• Which of the following expenses do not require the sanction of Parliament? I. Salary and allowances of the President and CAG II. Debt charges of the Government III. Defence expenditure IV. Maintenance expenditure of embassies
• Temporary tax levied to obtain additional revenue is called: