The term 'Budgetary Deficit' in the earlier classification referred to:
A. Fiscal deficit
B. Primary deficit
C. Difference between revenue expenditure and revenue receipts plus capital receipts excluding borrowings
D. Excess of total expenditure over total receipts excluding borrowings
Answer: Option C
Solution (By JKSSB Mock Tests)
In the older classification, budgetary deficit was the difference between total expenditure and total receipts (both revenue and capital, excluding borrowings). It is no longer widely used.
Explanation:
The impossible trinity states that it is impossible to have a fixed exchange rate, free capital mobility and an independent monetary policy simultaneously; only two of the three can be achieved.
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